Common Small Business Legal Issues
As a small business owner, it is essential that you remain aware of any legal issues your company may potentially face, and how to prevent them from happening. Being informed about legal mistakes that could be made by your small business can help you put policies and procedures in place that could ultimately save your company. Here are a few common legal issues small businesses face and how to ensure that your company is safe:
- Not having a shareholders’ agreement– When you first start your company, drafting a shareholders’ agreement may be the farthest thing from your mind. But without a document in place to guide everyone’s actions in the event of the sale of the company or the departure of one of the founders, your small business could self-destruct. Solution: Hire an attorney to draft a legal shareholders’ agreement stipulating a plan of action in case the company gets sold or anyone leaves, dies or gets a divorce.
- Compliance issues– As part of their due diligence, potential investors in your company will look closely at your business’s compliance with corporate procedures. If your company cannot demonstrate that it meets its compliance obligations, there is a good chance your investors will pass on your company to go with one that has its legal ducks in a row. Solution: To make sure your business is in accordance with standard compliance policies, hold annual shareholder meetings, regular board meetings, and keep signed copies of the meeting minutes in a corporate records file. It is also imperative that you properly document all financial transactions and keep your corporate banking information on file for handy reference.
- Not having HR guidelines– If your small business currently consists of three people, you may think it over-the-top to have a Human Resources handbook or other set of guidelines outlining employee conduct codes, codes of ethics, or other policies in place to set employee expectations. However, without a written set of HR guidelines in place, you are leaving yourself wide open for a wrongful termination lawsuit, regardless of your former employee’s behavior. Solution: Consult an HR professional about drafting an employee handbook with policies that best fit your company’s needs.
- Not obtaining a patent, copyright or trademark– Everyone has heard stories of an invention or product that was stolen right out from under its inventor due to their failure to obtain a patent or trademark. Don’t let that be you! Solution: Consult an attorney for an inventory of your company’s intellectual property, and go through the proper channels to obtain trademarks, patents or copyrights for all of it.
If you need an attorney to safeguard your Thibodaux, LA small business against potential legal threats, our small business attorneys can help. Contact Waitz & Downer today to schedule a free small business legal consultation.