diff --git a/CONTRIBUTING.md b/CONTRIBUTING.md
index 9f4f3173..f12098a4 100644
--- a/CONTRIBUTING.md
+++ b/CONTRIBUTING.md
@@ -74,16 +74,18 @@ Please read and adhere to our [Code of Conduct](CODE_OF_CONDUCT.md) to ensure a
    git clone https://github.com/pyupio/safety.git
    ```
 
-2. **Set up your environment:**
-- Ensure you are using Python 3.11.2.
-- Install dependencies:
+2. 2. **Set up your environment:**
+- Ensure you are using Python 3.9 or later.
+- Install the project in editable mode with development dependencies:
     ```bash
-    pip install -r requirements.txt
+    pip install -e ".[dev]"
     ```
 
 ### Running Tests
 We use pytest for running tests. To run the tests locally:
-    ```pytest```
+        ```bash
+    pytest
+    ```
 
 Ensure all tests pass before submitting your changes.
 
diff --git a/tests/test_error_handlers.py b/tests/test_error_handlers.py
new file mode 100644
index 00000000..02e8bb83
--- /dev/null
+++ b/tests/test_error_handlers.py
@@ -0,0 +1,88 @@
+import unittest
+from unittest.mock import patch, MagicMock
+import sys
+
+import click
+
+from safety.error_handlers import output_exception, handle_cmd_exception
+from safety.errors import SafetyError, SafetyException
+from safety.constants import EXIT_CODE_FAILURE, EXIT_CODE_OK
+
+
+class TestOutputException(unittest.TestCase):
+
+    @patch("safety.error_handlers.click.secho")
+    @patch("safety.error_handlers.sys.exit")
+    def test_output_exception_basic(self, mock_exit, mock_secho):
+        exception = Exception("Something went wrong")
+        output_exception(exception)
+        mock_secho.assert_called_once_with("Something went wrong", fg="red", file=sys.stderr)
+        mock_exit.assert_called_once_with(EXIT_CODE_FAILURE)
+
+    @patch("safety.error_handlers.click.secho")
+    @patch("safety.error_handlers.sys.exit")
+    def test_output_exception_custom_exit_code(self, mock_exit, mock_secho):
+        from safety.errors import MalformedDatabase
+        exception = MalformedDatabase()
+        output_exception(exception)
+        mock_exit.assert_called_once_with(exception.get_exit_code())
+
+    @patch("safety.error_handlers.click.secho")
+    @patch("safety.error_handlers.sys.exit")
+    def test_output_exception_exit_code_false(self, mock_exit, mock_secho):
+        exception = Exception("Something went wrong")
+        output_exception(exception, exit_code_output=False)
+        mock_exit.assert_called_once_with(EXIT_CODE_OK)
+
+
+class TestHandleCmdException(unittest.TestCase):
+
+    def setUp(self):
+        self.ctx = MagicMock()
+        self.ctx.obj.event_bus = MagicMock()
+        self.ctx.parent = None
+        self.ctx.command = None
+
+    @patch("safety.error_handlers.output_exception")
+    def test_handle_safety_error(self, mock_output_exception):
+        @handle_cmd_exception
+        def failing_func(ctx):
+            raise SafetyError("Test safety error")
+        failing_func(self.ctx)
+        mock_output_exception.assert_called_once()
+        args, kwargs = mock_output_exception.call_args
+        self.assertIsInstance(args[0], SafetyError)
+        self.assertTrue(kwargs["exit_code_output"])
+
+    @patch("safety.error_handlers.output_exception")
+    def test_handle_generic_exception(self, mock_output_exception):
+        @handle_cmd_exception
+        def failing_func(ctx):
+            raise ValueError("Some value error")
+        failing_func(self.ctx)
+        mock_output_exception.assert_called_once()
+        args, kwargs = mock_output_exception.call_args
+        self.assertIsInstance(args[0], SafetyException)
+        self.assertTrue(kwargs["exit_code_output"])
+
+    def test_handle_click_exception_is_re_raised(self):
+        @handle_cmd_exception
+        def failing_func(ctx):
+            raise click.ClickException("Click error")
+        with self.assertRaises(click.ClickException):
+            failing_func(self.ctx)
+
+    @patch("safety.error_handlers.emit_command_error")
+    @patch("safety.error_handlers.output_exception")
+    def test_successful_execution(self, mock_output_exception, mock_emit):
+        @handle_cmd_exception
+        def successful_func(ctx):
+            return "success"
+        result = successful_func(self.ctx)
+        self.assertEqual(result, "success")
+        mock_output_exception.assert_not_called()
+        mock_emit.assert_not_called()
+
+
+if __name__ == "__main__":
+    unittest.main()