ESIGN Act for Electronic Signatures in the US

Electronically executing agreements

Twenty years ago, in 2000, the landmark Electronic Signatures in Global and National Commerce (ESIGN) Act was passed in the U.S. to address the growing need for a consistent standard for electronic signatures. The ESIGN Act established electronic signatures as having the same legal status as traditional wet ink signatures in the U.S. at a federal level.

The ESIGN Act established that:

  • Any law with a signature requirement can be satisfied by an electronic signature.
  • Electronically executed agreements can be presented as evidence in court.
  • Denial of validity or enforceability of an electronically signed document can’t happen solely because it is in an electronic form.

In the years since this law was signed, organizations in industries throughout the world have adopted the use of electronic signatures to transform the way they do business.

To commemorate 20 years of the ESIGN Act, we’ve collected examples of how organizations use electronic signatures with agreements in the eBook 20 Years of E-signature Innovation.

How organizations use electronic signatures

Electronic signatures transform the real estate closing process

When Docusign eSignature was first released, the real estate industry was one of the first industries to take advantage of this new technology. Tracking the scale of transaction management improvements in real estate is a great barometer of how innovative leaders are using new technology in everyday transactions.

Keller Williams co-founder and CEO Gary Keller had a vision to transform the real estate industry. He saw clunky transactions and needless pain points for consumers and reimagined the way real estate could be sold using advances in business technology. The company evolved its consumer offering with the Docusign Agreement Cloud, giving Keller Williams a central focus point from which to imagine cohesive consumer experience from start to finish.

“E-signature revolutionized the real estate industry by creating a faster, more accurate and transparent transaction process. Instead of wading through mountains of paperwork, Realtors® can spend more time advising clients and remain confident they’re satisfying legal and compliance requirements.”

- Bob Goldberg, CEO, National Association of Realtors®

The end result is a friction-free experience that allows agents and buyers to use the same agreement system to manage the entire transaction. Today, Keller Williams is the biggest real estate franchise in the world by number of agents, units sold and sales volume.

Electronic signatures take the paperwork out of field sales transactions 

A critical part of the Comcast Business strategy is field sales representatives who go door to door and have personal conversations with customers. This model created connections with the local business community, but each sale required the rep to return to the office, print a contract and return to the customer signature collection. It was doubling the time necessary to do business and driving up costs related to printing, faxing, scanning and filing.

To modernize field sales, Comcast Business equipped field reps with electronic tablets, sales collateral and Docusign eSignature. Senior vice president Terry Connell said “Docusign gives reps the ability to meet with a customer, draw up a proposal and contract right there, and sign on the tablet in just one meeting.” Under the new system, field sellers have reduced the average number of meetings required to obtain new customers by more than 50%. Those reps are using that extra time to talk to more customers, meet new clients and solve their business needs.

HR adopts electronic signatures to streamline digital onboarding 

As an extremely fast growing company, Facebook’s HR team was onboarding around 50 new hires per week, requiring around 60% of the team’s time. At the core of this time-consuming process were paper documents, manually filled out by new hires and hand-delivered to the HR and payroll departments. Not only were these manual processes inefficient, they also created errors and missing or inconsistent data.

To update its paperwork process, Facebook chose Docusign CLM to move their documents to the cloud and create an easily searchable repository for all HR paperwork. Docusign fully integrates with existing information systems—including Salesforce, Workday and ADP—and took less than four weeks to set up in the U.S. The new process utilizes digital offer letters and utilizes a digital HR portal for new hires where they can view and sign all onboarding paperwork.

E-signatures allow for digital interactions, remote agreements

As we celebrate the 20th anniversary of the ESIGN Act, the world is fighting the outbreak of the COVID-19 virus. Governments are racing to increase agility and keep up with the needs of the people they serve. Since citizens rely on public services to fulfill basic needs, it’s not acceptable to let these programs lapse for any time while processes change.

In the first months of the pandemic, public programs at the national, state, county and city level began using eSignature to manage a wide range of routine services—contracting work, invoice appraisals, employee timesheets, medical consent forms, supplier agreements, education programs, legal proceedings and more—with a remote workforce. Docusign has also been at the core of new rapid response initiatives involving medical supply orders, Veterans Affairs policies and unemployment benefits.

Electronic signatures reduce need for paper contracts, printing, mailing

American Healthcare Lending (AHCL) has a mission to “Make Healthcare Affordable™” by contracting with healthcare providers and offering a technology platform to sit between patients and sources of financing. Unfortunately, AHCL was managing these relationships with 20-30 page contracts that required printing, faxing, signing, scanning and mailing. COO Nick Sorensen addressed the problem with a digital process that combines Salesforce and Docusign.

The new agreement workflow has eliminated costs associated with paper contracts, accelerated processing by automating manual steps and ensured contract accuracy. Since implementing Docusign eSignature for Salesforce, AHCL reports more than 2500 annual digital transaction requests and calculates a savings of more than $90 per contract. After success with sales agreements, AHCL expanded eSignature usage to human resource processes, channel partner programs, employee onboarding and product development processes.

Digital transformation and electronic signatures 

Refinitiv is one of the world’s largest providers of financial markets data. That industry moves fast, and a manual selling process that relied on a combination of manual handoffs, scanning, faxing, mail delivery and wet ink signatures was creating errors and creating difficulties for sellers.

To complete its digital transformation, Refinitiv built a process around an integration between Docusign Agreement Cloud and Salesforce. It delivered speed and transparency for customers and a simplified sales workflow for employees. The new digital sales process ushered in a 20% increase in customer experience and a rapid adoption among the sales team.

Director of digital transformation at Refinitiv, Eileen Kelly said “For our sales people, if it’s a sales close week, if you’re not using Docusign, you’re not really looking to make money that week.”

To read more about how Docusign eSignature has revolutionized agreements and customer experiences, download 20 Years of E-signature Innovation.

At the turn of the millennium, before ESIGN, organizations were adapting to the new digital landscape without clarity about how business should operate, especially the collection of signatures on important documents. Companies recognized that a shift was happening in digital commerce but attempts to create uniform regulations about electronic signatures contained too many exceptions and inconsistencies to be effective at scale across state lines. Without clarity on what constituted a legal signature, companies couldn’t get work done efficiently.

ESIGN eliminated this confusion, establishing guidelines for innovative tools like Docusign eSignature to empower businesses and their customers to radically simplify transactions.

To learn more about the legality of electronic signatures, see our electronic signature legality guide.

Milestones like this are an opportunity to celebrate how far electronic signature has progressed in two decades and imagine what’s possible as digital business processes continue to evolve.