You’re probably not thinking about the law and legality too much when you’re setting up your business. It’s possible that it just hasn’t crossed your mind. After all, as long as you don’t intend to break the law, you’ll always be on the right side of it…right?
Wrong, because it is easy for business owners to unintentionally breach laws and legal regulations. They will often be completely unaware of this until they are informed by a legal professional.
A perfect example of this would be sanitation regulations. If you’re running an office, you are probably vaguely aware of the fact that you need to provide a restroom for your employees. But how many does there need to be per number of employees?
What kind of sanitation policies must be in place to avoid health and safety scrutinisation? Is it legally acceptable to have a unisex toilet? You might think this is a smart way of getting around the controversy of gender neutral bathrooms but whether it’s legal is another matter entirely.
That’s just one area of the law that you need to think about. There are many more. So, how can you make sure you’re not getting tied up in legality when running your business?
Hire an advisor
There’s a secret about lawyers that you may not be aware of. They speak in their own unique language, and legal documents aren’t written to be understood by a layperson. Have a look at the user agreement that you unknowingly agree to whenever you use an Apple device.
You might think that it’s a lot of mumbo jumbo and it is. But it’s also there to protect the company from legal issues and ensure that they’re not left open to expensive lawsuits. If you think the CEO created these legal terms, you’re wrong.
They’ll have a team of highly trained lawyers working day and night to protect them. You might not be able to afford a team like this.
However, you should have at least one legal advisor who you can call up whenever you need them. Lawyers are notoriously expensive, so the best way to handle this is use an outsourcing service. That way, you’ll be able to afford legal advice without taking on a constant fixed bill for wages.
The most important factor to consider when looking for a legal advisor is accessibility. You need to make sure that they are always there if and when you need them to be.
You never know when you might need to agree to a contract that you don’t fully understand or make changes to your business that may not be approved by regulations.
Many people say that a business is built on profits. On the contrary, a business is built on contracts from the agreements that you make with your employees to the terms you trade with partners on.
As such, you need to make sure that your contracts are iron clad and protect what is important to your business. As an example, you need to know what an employment contract should contain to protect your business from a legal standpoint. For instance, notice periods are typically referenced.
A notice period protects you from an employee walking out after finding a better job and leaving you high and dry. Think about the type of impact of someone high up in your business choosing to leave your company. During the time when you were trying to fill that position, your business would be facing a major disadvantage.
There are multiple ways business contracts can protect you and your company. You might be working with a new business partner to arrange the supply of a product. What happens if one day they decide to stop supplying you with the product you agreed on. Or, their numbers drop.
This would put your profits in jeopardy. With the right contract, you can, at the very least, push a business to reimburse you for any losses. It is useful to have this power in a market where alliances constantly shift and change.
Know the danger zones
There are dangerous areas in your business where you are more at risk compared with others. One example of this would certainly be premises liability.
Premises liability, essentially means that when you own property, you are responsible for anything that happens there. This means that if someone is injured in any way, you can be held accountable. When that happens, it can lead to a costly lawsuit.
By recognizing this issue, you can work to prevent it causing problems in your business model. For instance, one of the best ways to avoid a PI claim is to keep health and safety standards high.
You can do this by regularly checking your business property for issues. You would be amazed how many accidents are caused by faulty equipment. By getting your equipment checked every six months, you can avoid this possibility completely.
You might also want to think about providing attentional training for your employees. It’s fair to say that the more training they have, the safer they will be.
Don’t’ forget that in a large majority of cases accidents in the workplace are caused by employee mistakes. But even in a situation like this, you can still be held accountable.
Of course, safety isn’t the only danger zone when it comes to legal problems. One of the biggest issues for small firms is definitely finances. Usually, small companies make the mistake of underpaying on taxes.
This can be a nightmare situation because the penalty for this can be so large that it puts the business in immense financial pressure.
The best option is to make sure you are hiring an accountant to handle things like taxation. They’ll keep you on the straight and narrow, ensuring that you don’t face the wrath of the taxman.
As you can see, legal issues are definitely going to present problems in your business and we’re really just scratching the service. But with a little forward planning, you can certainly avoid most of the trouble.