Most small businesses neglect to hire legal representation because of the extravagant cost of legal services. However, most entrepreneurs discover that hiring legal representation is something that they should not have neglected doing. If you are running a small business, you might find it challenging to set aside enough budget to pay for legal services. You might be thinking that considering legal services is not something you should be worrying about.
However, you must think along the lines of all the legal issues that your business might face especially if you are thinking of expanding or growing your business. Therefore, you must prioritize setting aside enough money to pay for legal services if legal problems arise.
Although there are a lot of ways that you can prevent lengthy and legal disputes, it is always best to be prepared at all times. Preparing for the unexpected might even be the thing that saves your business from failing. You can start looking for a flat-rate business attorney to represent your business or read about the most common legal issues that you could face in the future make you well-informed about legal matters. Below are some of the common legal issues that most entrepreneurs face regardless of factors like the business’s type and size.
Failure to Define Company Structure
Having an undefined business structure can create problems for you and get you in trouble with the law. Defining your company’s structure is the foundation of all the policies and future work that your company will build for your business. Furthermore, your company’s structure also determines the extent of personal liability if you face a lawsuit. In addition to this, company structure also determines the taxes you need to pay.
To avoid having problems because of an undefined business structure, you must register your company as a sole proprietorship, partnership, C corporation, S corporation, or a limited liability company. You have to determine the type of company you have to register as soon as you establish it. By doing this, you are eliminating the risk of being sued for having an undefined business structure.
Issues Regarding your Employees
Legal policies are always being updated. Therefore, employers must always keep up with all the changes that have been implemented to avoid getting tangled up in lawsuits. One of the most common reasons why entrepreneurs get in trouble with the law is employee-related issues.
There are a lot of problems that fall within the category of employee-related issues. Employers need to be well-educated about employee classification, employment termination, discrimination, information sharing, use of electronic devices, health and safety, and immigration audits. If you fail to educate yourself about common legal issues related to your employees, you might end up being surprised by lawsuits in the future. Therefore, it is best to do everything you can to avoid legal problems for your company.
Work Policies for Foreigners
If you think that outsourcing a part of your operations to a different country will help your business grow and succeed, you must first seek legal counsel from a legal professional. This legal professional will help you understand the policies, contracts, and procedures that are in place in the foreign jurisdiction to where you plan to outsource your business to.
You also have to be educated about specific employment procedures and policies. These procedures and policies could be entirely different from the policies and procedures that you know. Therefore, you must learn as much as you can about the employment conditions and policies in the foreign jurisdiction entity you wish to tap to avoid legal problems in the future. Doing this will also allow your business to expand to the new marketplace in the future.
Intellectual Property Protection
When you consider intellectual property, you must make sure that you cover all creations protected in law by trademarks, patents, and copyright which enable their creators to earn financial benefits and recognition from them. If you fail to take appropriate legal steps, you might risk losing all of your creations to another business.
In addition to this, if you fail to conduct a market analysis and fail to register your intellectual property like patents or trademarks, you might be sued for infringement by other entrepreneurs or businesses or even individuals who believe that you have conducted an unauthorized imitation of their products or services. If they have sufficient proof, you might end up losing the lawsuit even if you are not guilty of anything. Therefore, it is best to take the necessary steps to protect your intellectual property and respect other businesses or entrepreneurs’ intellectual property.
The best way to protect yourself from legal problems is by making sure that you have hired legal representation and have educated yourself about the most common legal issues that your company might face. It is always better to be prepared rather than lose your assets or your entire business because you have neglected to prepare for possible legal problems that you might face because of your company.