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There is a reason why this blog post is not titled “How To Deal With Legal Issues As A Small Business Owner”. The key to legal issues and small business is avoiding them.
Avoid Legal Problems, Don’t Deal With Them
The reality is that once you have breached a contract or mistreated an employee there is not much you can do but call your lawyer. And here start the real headaches, bills are piling up and your business is suffering.
Any legal misconduct should be avoided by small businesses more than any other because, let’s face it –small business owners rarely have the cash to handle a lawsuit.
Legal Problems and How To Avoid Them
1. Employee agreements
It might be common sense but one way to avoid legal issues with your employees is to keep a trail of everything that is going on. All your employee files should be backed up. Make sure that you are complying with the employment, maternity, reimbursement, insurance and discrimination laws when you hire someone.
It is also important to have your employee sign a termination agreement upon leaving your company. Such an agreement signed by a lawyer will have legal value if the employee comes back with a claim.
One of the areas you need to consider when hiring is also non-compete agreement. Make sure you have all your employees sign one and ask them if they still have any other agreements active from previous employment.
2. Intellectual property

The biggest issue with intellectual property is that manytimes small business owners have no idea they are inviolation or they need protection. Many organizations just sit around and wait for someone to infringe their copyright and get easy money.
Big corporations have assigned watchdogs to research ifanyone ever uses their copyright material. But do you?
Review every material that you are going to use and have not produced yourself – where does it come from and is it licensed? Do that before you use any of it even if you are sure it is safe – you can NEVER be sure enough nowadays!
Your lawyer knows where to look and how to find out if you are unknowingly using copyrighted material, or if anyone out there is using yours and how to get a court order for him or her to stop.
3. Taxes again?

This is one of the most unpleasant parts of doing business, we know. But one of the most essential as well– you can’t be vague on your taxes. With the ever-changing tax laws you need to stay up to date and review tax requirements regularly.
The risks you are running if you don’t are, well, losing your business as one. Don’t ignore the tax issue and make sure you take a look at all the requirements for your business each and every period. Don’t let the fine print or new legislations to catch you unprepared.
Also, make sure you are aware of your tax documentation even if you are not the one dealing with it – just make sure you know what’s in there!
4. Supplier and vendor contracts
One of the biggest legal problems that occur in small businesses is due to weak or non-existent contracts. Make sure that contractors, suppliers or vendors sign every discussion or agreement you have with them.
In fact, it is best to have your legal advisor review each and every contract individually (except standard customer agreements you have for your clients) especially if the other side drafts it.
A properly written agreement can help you protect your business and will save you a lot of legal expense if you come to have to defend your rights in court.
In the end,
The Biggest Mistake You Can Make As A Small Business
is to ignore when to seek legal advice. Going to court will cost you much more in legal fees than just consulting your advisor prior to entering into any binding agreements with employees, landlords, contractors or clients.
Don’t Avoid Your Lawyer To Avoid Legal Problems

Prevention is your best choice when it comes to legal issues and your business. If thinking about everything is a challenge, let your legal advisor help!
The top decision to avoid legal problems for your small business is to contact a legal counselor who can outline the risk areas of your business. This is the shortest way to save yourself and your business the mess.
Contact us and we will be happy to review any area of your business that can get you in trouble.