Individuals starting new businesses are usually pulled in 100 different directions, and quite often legal issues get overlooked. However, these small pieces of your business can become a big headache down the road if they are not properly handled in the first place. Here are some points to take into consideration.
Business Structure
There are many different options as to how you can structure your business, including sole-proprietorship, partnership, limited partnership, corporation, S-corporation, and limited liability company. Each has its own unique characteristics, specifically regarding liability protection and tax structure. The wrong choice could leave you open to issues in the future.
Personal Interest Protection
If you plan on going into business with others, it is important to protect your personal interests. Partnership agreements, articles of incorporation, and articles of organization can be lengthy, complicated documents, and it is vital to understand your liabilities, rights and obligations before entering into one.
Licenses, Permits, and Compliance
Depending on the type of business you are entering, you may be required to obtain licenses or permits to carry out your business, whether on a state, county, or local level. Additionally, businesses must stay in compliance with the laws as they constantly change. As a business owner, you will be required to comply with laws on everything from business filings to employment practices to zoning laws. You may not even be aware that a particular law affects your business, until someone complains that you are violating the law.
Non-Disclosure Agreements and Intellectual Property Protection
Protecting your business ideas is key to survival, especially at the early stages of a company. Trademarks, patents, copyrights and non-disclosure agreements are designed to protect your business from competitors trying to use your ideas.
Customer relations
Many companies run into issues stemming from their customers. Standard customer contracts can cause a lot of trouble if they are not properly drafted from the get-go. Additionally, many companies have issues with bill collection from customers. Should a dispute with a customer arise, having someone who already understands the situation may help you settle the matter quickly.
Employee relations
Other than customers, the biggest problem that businesses face is employee relations. From employment contracts and handbooks to discrimination problems, making sure you are aware of potential pitfalls and questionable behavior could save you from embarrassing, and often crippling, litigation.
These are just some of the legal issues companies run into. If you would like to discuss any of these topics further, or have any other questions, feel free to contact me at yszpigiel@wzssa.com, or call my office at 516-568-1850.