Are electronic signatures legally binding?

Yes. In the United States, an electronic signature has the same legal effect as one in ink for almost every business and personal agreement. Two laws, the federal ESIGN Act and the state-level Uniform Electronic Transactions Act (UETA), say a contract cannot be denied legal effect just because it was signed electronically. The EU, the UK, Canada, and Australia have laws that do the same.

That does not mean every electronic signature is automatically valid. The same rules that apply to a paper contract still apply, a short list of documents is excluded, and if someone later says they never signed, you need to be able to show that they did. Here is what that looks like in practice.

In this article

• What the law says
• What makes an electronic signature valid
• Proving who signed
• Documents you cannot sign electronically
• Outside the United States
• What to look for in an e-signature tool

What the law says

The ESIGN Act (the Electronic Signatures in Global and National Commerce Act) has been federal law since 2000. Its core rule is short: a signature, contract, or record cannot be denied legal effect, validity, or enforceability solely because it is in electronic form. If a law requires a document to be in writing, an electronic record satisfies it, including the state laws that require a written contract to hire a freelancer.

UETA is a model law that 49 states and Washington, D.C. have adopted, so state law says the same thing. New York, the one state that has not adopted it, has its own Electronic Signatures and Records Act with the same effect.

Neither law requires a particular technology. ESIGN defines an electronic signature as an electronic sound, symbol, or process attached to or logically associated with a record and adopted by a person with the intent to sign it. A drawn signature, a typed name, and a clicked "I agree" can all qualify. What the law cares about is the person's intent and the record that shows it, not what the signature looks like or whether it uses encryption. That is also why an electronic signature and a digital signature are not the same thing.

What makes an electronic signature valid

Courts and the statutes look for four things:

1. Intent to sign. The signer took a deliberate action to sign, such as drawing or typing their signature and pressing a button to finish. A signature that appears without the person choosing it does not count.
2. Consent to do business electronically. UETA applies only when the parties have agreed to deal electronically, which can be inferred from how they behave. ESIGN adds a formal disclosure and consent step when a law requires information to be given to a consumer in writing.
3. A link between the signature and the document. The signature has to be attached to, or logically associated with, the specific record being signed.
4. A record everyone can keep. The signed document must be retained in a form that can be accurately reproduced later by everyone entitled to it, for as long as a signed contract needs to be kept.

On top of these, it still has to be a valid contract. Offer and acceptance, capacity, and a lawful purpose matter exactly as they do on paper. Signing electronically does not rescue an agreement that would fail in ink.

Proving who signed

When an electronic signature is challenged, the argument is rarely about whether electronic signatures are allowed. It is about whether this particular person actually signed. UETA says a signature belongs to a person if it was their act, and that this can be shown in any manner, including by the security procedure used to collect it.

That is the job of an audit trail: a record of who was asked to sign, how they were reached, what they did, and when. Inkly sends each signer a private link to their own email address and records the sent, viewed, and signed times to the second, along with the IP address, approximate location, and device used at each step. It also records a SHA-256 fingerprint of the completed PDF, so anyone can check whether the file has changed since it was signed. All of it goes into a Certificate of Completion that every party receives. Our guide to what an electronic signature audit trail records walks through one.

A screenshot of a signature pasted into a PDF has none of this. It may still be a valid signature, but if it is disputed, you are left with your word against theirs.

Documents you cannot sign electronically

ESIGN leaves a short list of documents to other laws, most of which still expect paper:

• Wills, codicils, and testamentary trusts
• Adoption, divorce, and other family law matters
• Court orders, notices, and official court documents such as pleadings
• Notices that utility service will be cut off
• Notices of default, foreclosure, repossession, or eviction for a primary residence, and the right to cure them
• Notices canceling health or life insurance benefits
• Product recall notices that affect health or safety
• Documents that must travel with hazardous materials
• Most documents governed by the Uniform Commercial Code, apart from contracts for the sale or lease of goods

Some of these are changing. A growing number of states allow electronic wills under their own statutes, and most states now permit remote online notarization. Those follow separate rules with their own requirements, which we cover in whether electronic signatures need a witness or a notary.

Everything else, including sales and service agreements, NDAs, employment offers, leases, consent forms, invoices, and contractor agreements, can be signed electronically.

Outside the United States

• European Union. The eIDAS regulation says an electronic signature cannot be refused as evidence just because it is electronic. It defines three levels. A simple electronic signature suits most contracts, while a qualified electronic signature, backed by a certificate from an approved trust provider, is treated as equal to a handwritten one and is required for a few acts in some countries.
• United Kingdom. The Electronic Communications Act 2000 and the UK's version of eIDAS recognize electronic signatures, and the Law Commission confirmed in 2019 that they can validly execute most documents, including deeds, though a deed still needs a witness who is physically present.
• Canada. Each province and territory has its own electronic commerce act, most based on the Uniform Electronic Commerce Act (UECA), and these give electronic signatures legal effect, with similar exceptions for wills, powers of attorney, and some land transfers. Québec has its own law to the same effect, and federal law (PIPEDA) covers dealings with the federal government.
• Australia. The Electronic Transactions Act 1999 and matching state laws accept an electronic signature when it identifies the signer, shows their intent, and is reliable for the purpose.

What to look for in an e-signature tool

The law sets the requirements; your tool is what proves you met them. Look for:

• A consent step where each signer agrees to sign electronically before they sign
• A separate signing link for each person, sent to their own email address
• An audit trail with timestamps, IP addresses, and devices for every step
• A way to show the signed file has not been edited since
• A copy of the signed document and its audit trail for everyone who signed

Inkly does all of this on every plan, including Free. You can read how it lines up with ESIGN, UETA, UECA, eIDAS, and GDPR on our compliance page.