7 Documents Every Gym Owner Needs (with free download copies)

Most gym owners didn’t start their gym to become paper pushers. The opposite in fact. Despite that, there are a few key documents that every gym needs in order to administer their business, limit risk, manage staff, and maintain their gym space.

In this article we’ll cover the 7 essential documents every gym needs to use, explain why they’re important and how to use them in your gym, and finally, we’ll provide you with a free sample version that you can use to craft your own documents.

Article Overview

1. Member Liability Waiver: For Legal Protection for Injuries.
2. Gym Operating Agreement: To Run & Manage Your Gym.
3. Gym Instructor Contract: For Hiring & Managing Trainers.
4. Gym Incident Report: For Documenting Incidents.
5. Equipment Maintenance Log: For Documenting Repairs.
6. Federal & State Tax ID For Paying Taxes.
7. Entity Registration For Forming Your Legal Entity.

1. Member Liability Waiver

What Is It?

A liability waiver is typically a one or two page document in which new gym members acknowledge the risks of participating in training at your gym, the member (and their heirs) agrees to not sue you, your employees or your gym for injuries (or even death) which might occur because of those risks, and the member agrees to waive any claims they might have.

Typically a good waiver also includes a couple of other things, like making it clear that the member needs to communicate, in writing, any physical or mental limitations in their ability to fully participate before they start training. And it should have the member agree to any gym rules, that the gym isn’t responsible for lost property, etc.

What You Need To Know

A well drafted liability waiver is perhaps the most essential risk mitigation document any gym can have. So much so, we built signing and storing one for every member into the SimpleGym platform to make sure our customers get one on file for every member, every time.

Generally, waivers are very effective in preventing lawsuits against your gym for injuries. There are a few tips to make them more effective…
Make sure it’s well-drafted. Some states require very specific language to make a liability waiver effective.
Make sure it’s comprehensive. There’s a reason attorneys list ten things when it seems like just one would suffice. They are trying to prevent lawsuits from every angle.
Make it clear and voluntary. Courts don’t enforce waivers when the language is ambiguous or the person seems pressured into signing. Simply make signing a waiver a required part of joining the gym, make sure the document is titled in a clear and unambiguous way with normal font size, and you should be good to go.

Get it signed well before problems arise. You don’t want to be passing around a waiver after the injury has occurred. It looks bad, and it’s legally far less effective. Make the liability waiver part of all new member and guest signups.

Where To Get One:

Note on using our copy: Consider having an attorney look it over to make state or business specific tweaks to better suit your gym.

2. Operating Agreement

What Is It?

If you decide to form an entity (LLC, C-Corp, Partnership, etc.) to own your gym through, you’ll need an Operating Agreement for the entity. An operating agreement basically spells out the rules, regulations, accounting, and other details of how the gym’s entity will be run.

A good gym operating agreement should be simple enough for you to actually read and understand, while also being comprehensive enough to cover all of the essentials and how you plan to deal with unanticipated conflicts or problems, should they arise.

What You Need To Know

Most new gym owners typically go one of two ways: they dig in and dissect every detail of their operating agreement, or they literally never even glance at it. Try to be somewhere in between. When you’re starting out, your operating agreement won’t make or break your business. Make sure it’s flexible and it covers the basics, and you’re all set. On the flip side, including very rigid requirements (like that you need a unanimous vote from all partners to do anything) can hurt a business long term, so again, leaving flexibility in the agreement is key.

There are a few specific guidelines we suggest you follow, at least early on, in crafting your gym’s operating agreement,:

1. Prepare for management disagreements. A successful gym will be around many years, if not decades. No relationship, whether personal or professional, lasts that long without any conflicts or disagreements. A system for handling those disputes in a straightforward way within the operating agreement, such as via a ‘majority rules’ clause for day-to-day decisions, and 75% vote required for big decisions like taking on business debt, prevents things from getting heated between partners down the road.
2. Clearly define non-compete and fiduciary duty. If a partner in the gym decides to start a clothing line that they want to sell in the gym space, who decides what price the gym should buy the clothing at? What if a partner provides legal or accounting services to the gym, do they need to offer it at a break-even cost, retail price, or something in between? How about if a partner gets approached by a big investor to start a gym of their own down the street, can they do it? And finally, what happens if a partner who you expected to run a number of classes, gets an offer to train at another gym for 2x the rate and doesn’t want to teach at your gym? These are the sorts of issues that can cause tension and resentment between partners. So deciding on this in the abstract before there’s an actual heated conflict, and putting it in your operating agreement, will avoid a big source of intra-partner fighting.
3. Prepare for raising capital. Gyms typically need to raise capital once or twice in the life of the gym. That might be taking on an investment from new or existing partners, or taking a bank loan for expansion. Business partners often feel pretty differently about how much debt is appropriate to carry, or whether to admit a new partner and on what terms. A good operating agreement spells out the procedures for deciding all of that ahead of time before partners’ emotions are heated.
4. Define how to value the entity, and how to sell. If you have multiple partners, chances are, one of you is going to want to sell some or all of your ownership interest at some point. Selling shares in a gym isn’t like selling shares of Coca-Cola on the New York Stock Exchange. First you’ll need to decide on a valuation method (there are a few of them), then decide whether partners can sell to anyone or only someone the other partners approve of, whether the other partners get the right to buy them out first, etc. All of these decisions are better made up front, and clearly spelled out in the Operating Agreement.