The following is a guest post that I hope will be helpful and provide valuable information. If you have any questions, please do not hesitate to contact me!
The coronavirus pandemic leaves many with unanswered questions. As always, small businesses are feeling the brunt of the pandemic’s effects. Not only are they struggling to stay afloat, but also to understand their legal and financial options. Low profits, temporary or permanent closures, liability, employee benefits, COVID precautions, and the availability of loans, grants, and financial assistance or lack thereof may all raise legal quandaries that need answers.
That is where programs like Lawyers for Good Government come in. Under the program, small business owners can pose “their most pressing coronavirus-related legal questions on an intake form so they can be paired with a lawyer who has expertise in those areas,” News4Jax writes. The nationwide initiative is currently serving New York City, Detroit, and the states of Alaska, Connecticut, Florida, Georgia, Idaho, North Carolina, South Carolina, and Washington.
Lawyers for Good Government clinics offer free consultations by phone and, in some cases, may provide limited ongoing guidance or legal assistance.
For those who require long-term assistance, consider doing your part and giving back to the local community. Hire a local small business attorney to help you navigate any tricky legal situations that may come up during or after the pandemic.
Learn the many benefits of building a lasting relationship with a local business attorney.
Protection From Lawsuits
The Small Business Association puts it plainly: “Litigation is costly to small business owners both in time and money.” In fact, a single lawsuit can set you back anywhere from $3,000 to $150,000. Team up with a lawyer to avoid legal troubles whenever possible and to keep costs low if it comes to it.
Here are the most likely lawsuits you may run into as a small business owner:
- Intellectual property rights disputes or violations. “Whether it’s your logo, an image you found on the web, or the name of your business, another company may say you stole from them,” Business News Daily reveals. Unfortunately, there are so many businesses out there that it is very possible to accidentally design a logo that looks similar to an existing one. By pairing up with a trusted law firm, you will be able to defend yourself and your intentions in court — or even settle disputes before it comes to that.
- Disputes among shareholders. Especially in the early stages of a business or among small businesses, shares may change hands frequently. Work with a local small business attorney to stipulate what will happen if an owner, shareholder, or partner dies, sells their part of the company, or otherwise leaves the business.
- Harassment or discrimination against customers. Doctrines like “The customer is always right” exist for a reason. If you or one of your employees say or do anything to offend a customer, you may have a lawsuit on your hands. That may even be the case if a customer misinterprets your words or actions and alleges that you have acted offensively. A local small business attorney can help you resolve the dispute and draft a plan to prevent discrimination and legal actions against you in the future.
- Fraud allegations. In many cases, fraud is an intentional and calculated act — but not always. There are so many things to think about when starting up a new business and when keeping it afloat (especially right now!) that making some mistakes when it comes to the books and accounting for all revenue and expenses is to be expected. Work with an experienced local small business attorney to make sure your finances and documentation are in-line.
A small business administrative attorney can help counsel you before you step over any lines. If your business is facing a lawsuit, a lawyer can help you argue your case and settle for significantly less if need be.
Compliance With State and Federal Rules and Regulations
Did you know that there are local and national ordinances you must follow when you are running a small business? If you are not 100% familiar with them, a local small business attorney will be — and they will be able to relay any other essential information you need.
“A small business may need to check zoning rules to ensure that construction is possible,” HG.org Legal Resources reveals. Plus, depending on what sort of business you own, you may have to be a certain distance away from competing businesses and you may have to follow certain restrictions when it comes to advertising your services. Talk to a business attorney about regulations specific to your area as well as national laws you need to know about. Here are a few that might come up as you run your small business:
- Consumer data privacy laws. Just like you would not open up an expensive jewelry store without a quality security surveillance system, it is unwise to operate a business without carefully minding your customers’ data. That includes sensitive paperwork as well as data captured online or via a debit and credit card processor. What’s more, depending on your location, you may not have a choice. In California, for example, the California Consumer Privacy Act (CCPA) lays out what businesses must and must not do to keep consumer data safe. Other cities and states are likely to follow suit — if they haven’t already.
- Licensing and taxes. According to National Funding, “If you’re supposed to have a license but try operating without one, the government could fine you and even shut down your business.” Talk to a local small business attorney about any licenses that you may need for your business and any other important local regulations that may apply.
Plus, businesses must file taxes and charge sales tax where applicable on all appropriate items.
- Paying legal wages. As a small business owner, you should know that there are specific laws about how much you pay your employees, what hours you pay them for, and whether you classify and pay your workers as salaried, hourly, or independent contractors. You must pay the federal minimum wage at an absolute minimum, and some states or local jurisdictions may require you to pay more. Hourly employees must receive overtime for working more than 40 hours per week, and you must pay them 1.5 times their normal hourly rate. There are different laws for salaried workers and those who qualify as independent contractors.
- National advertising regulations. The Federal Trade Commission (FTC) lays out some very specific rules. “You cannot make claims that are false, untruthful or purposely misleading,” National Funding continues. When it comes to email marketing, it is illegal to send marketing emails without an option for customers to opt-out or unsubscribe. Visit www.ftc.gov/tips-advice/business-center/guidance/advertising-faqs-guide-small-business for the FTC’s full advertising guidelines for small businesses.
- Retirement savings legislation. Right now, the federal government has not laid out specific retirement laws for small businesses. That doesn’t mean the same holds true for your state — or for your city. Talk to a local small business attorney about local retirement legislation or lack thereof. Nine states currently have state-specific legislation in place. Other states and cities are waiting on federal legislation to pass.
Assistance With Insurance and Policies
Local and state ordinances are not the only regulations you need to look out for. When operating a small business, it is important to understand small business insurance. Know what’s required and what is strongly recommended. Being familiar with business insurance will protect you and your company now and for years to come.
Here are the types of insurance it is wise to have:
- Professional liability insurance. Professional liability insurance or errors and omissions (E&O) insurance protects you from mistakes and negligence claims.
- Property insurance. Local small business attorneys warn business owners not to skip this one. Property insurance covers you in the event of theft, a fire, or a storm. Most plans will reimburse you for equipment, furniture, and any other documented inventory.
- Vehicle insurance. If your small business requires the use of company vehicles, insurance is a must. At a minimum, get enough insurance to cover damages to the other vehicle should one of your employees cause an accident. Often, it is best for your bottom line or pocket to purchase insurance plans that will cover company vehicles as well.
- Business interruption insurance. “If a disaster or catastrophic event does occur, a business’s operations will likely be interrupted. During this time, your business will suffer from lost income due to your staff’s inability to work in the office, manufacture products, or make sales calls,” Entrepreneur writes. This type of insurance covers this loss in revenue.
It is important to note that business interruption insurance is not a catch-all, and you may need a quality business litigation attorney to argue your case. For example, amid COVID-19, “Judges have dismissed more than four times as many business-interruption lawsuits as they’ve allowed to proceed,” The Insurance Journal reveals. The virus is putting pressure on insurance companies to pay out, and, to prevent their companies from going under, insurance agencies are fighting it.
Liability and Employee Issues
Liability comes in many different forms as do employee concerns. A local small business attorney can help you navigate all of these sticky issues, even the particular ones.
For example, premises liability insurance is not the same as property insurance. What is the difference? While these differences may seem to fall under the nuances of law — in this case — they do not. Property insurance protects your property. Insuring your property against liability entails purchasing coverage that will cover slip and falls, medical emergencies, and/or violent acts that may occur on your property. Talk to a premises liability lawyer if you have any questions.
Just as it is important to have insurance should a customer slip and fall on your property, it is equally important to have insurance coverage if one of your workers is hurt on the job. Workers compensation insurance will cover medical expenses, disability benefits, or life insurance benefits if applicable.
It is important for all businesses to have workers compensation insurance. Some workers may get injured in ways you might not initially expect. For example, correcting carpal tunnel syndrome may require costly surgery, and office workers may be able to reasonably prove that they sustained the condition while on the job. Talk to a workers comp lawyer about all of the possibilities and the level of coverage you realistically need in your line of work.
A local small business attorney can help you with a variety of employee issues, not just workers who are injured on the job. Talk to a local law firm about discrimination and harassment charges, or about illnesses employees may sustain on the job.
Assistance With Financial Questions
If you have any other questions that may require legal counsel, do not hesitate to ask a local small business attorney! Things come up, and they may be more relevant to a lawyer than you might think.
For example, a printing company may have questions about trash collection and the proper — or even legal — disposal of sensitive materials, like printer ink and toner. Generally speaking, it is perfectly legal to throw used cartridges into the trash. If you purport to be a green or ecofriendly company, however, you may want to consider more environmentally friendly disposal methods, like returning them to the manufacturer for recycling.
Auto body shops, on the other hand, are required to dispose of oil and other, caustic chemicals in legally compliant ways. A local small business attorney may be able to fill you in on local regulations or point you to free resources for strict compliance.
Unfortunately, one-fifth of small businesses will fail in 12 months or less. This year, that number may be significantly higher due to COVID-19. Increase your chances of staying afloat and keeping things under control in trying circumstances. Work with a local small business attorney to make sure your small business is compliant with local and state regulations and prepared in the event of theft, a workplace injury, fraud accusation, or the unexpected.