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The video discusses employment contracts and contracts with independent contractors, highlighting their prevalence in the U.S. Each state has its own laws regarding these contracts. An employment contract typically details the scope of work, duration, and obligations, including insurance-related issues. A key focus is the enforceability of specific terms, particularly covenants not to compete and restrictions on the use of confidential information generated during employment. Inspectors often scrutinize these aspects, emphasizing their importance in ensuring compliance and protecting both employer and employee interests.