When you decided to go into business for yourself, you were focused on your passion project: what you would bring to the market and how you would make it work. Few people anticipate the many legal pitfalls and requirements that small businesses face until it is too late, and they are confronted with a problem. Understanding what the most common legal issues that small businesses have to confront and being proactive in your approach will go a long way toward protecting yourself in the future.
The most common legal issues that small businesses face include:
- Failing to ensure that they are properly licensed. Checking on the requirements that your local municipality has in place may seem like a waste of time when you’re focused on getting started, but it can come back to bite you if you fail to do so.
- Failing to do adequate trademark research or discovering that somebody else is infringing on your trademark. When you name your business or put a new product or service on the market, you need to make sure that you have the right to use the name and aren’t infringing on somebody else’s trademark. Likewise, you need to register your own trademarks in order to protect yourself if somebody infringes upon yours.
- Firing an employee in a legally acceptable way. Though employees are generally considered to be “at will” and employers are free to terminate them for any reason that doesn’t mean that doing so in a casual way is smart. Being clear in your communication of expectations, employee rules and outcomes can help protect against lawsuits.
- Employee classification. In many cases businesses classify employees incorrectly, referring to them as independent contractors. Understanding the difference between the two can help to prevent significant trouble down the road.
- Shareholder issues. Any business that has more than one shareholder needs to make sure that they have appropriate agreements in place in order to protect against disagreements or misunderstandings that can lead to legal action.
- Wage and payment issues. Employers can protect themselves against legal action regarding wages and overtime pay by detailing their payment policies within an employee handbook and ensuring that they are acting in a way that is fair to all employees.
- Lawsuits filed by outsiders. Whether a member of the public, a contractor, a client or anybody else, there is always the risk that businesses will face lawsuits in the future.
If you are a small-business owner and you need information about protecting yourself against future litigation or representation in a current situation, contact us today to set up an appointment to talk.
