4 Legal Steps to Take to Protect Your Small Business

protect small business
Steps you should take to protect your small business

You have a lot to think about on a daily basis when you run your own business, like scheduling staff, managing budgets, working with customers, generating leads, and figuring out how you can maximize your profits, to name just a few.

There’s not much more you can fit on your plate. And probably the last thing you want to worry about is dealing with legal trouble. Disgruntled employees, copyright issues, workplace injury, tax implications—the list of potential legal troubles goes on and on.

In order to protect yourself and your business from encountering legal battles down the road, it’s important to take these 4 steps.


1. Start planning before you even open up shop

When it comes to dealing with—and avoiding—legal matters, preparation is key. Before you even go through with your business plan, start by conducting a trademark search with the U.S. Patent and Trademark Office.

This will help ensure that no other businesses have already registered a similar name or concept.

You can also search domain names to make sure there aren’t any websites with similar names as your desired domain name. These steps can help you avoid copyright issues later on down the road.


2. Protect your employees

Your team is one of your greatest assets, no matter how big or small it is, so it’s always worth going the extra mile in order to protect them. There are many ways you can do this.

  • Hire an HR team or use HR software to make sure that you are following proper legal processes when working with your employees. Employment law governs a variety of scenarios including hiring, termination, disciplinary actions, pay, and benefits. Not abiding by these rules could put you in a compromising position if a disgruntled employee decides to pursue legal action.
  • If your workplace poses the threat of injury to employees (heavy equipment, machines, etc), you will likely need to look into some PBM for worker’s comp solutions. Arming yourself with these policies can help ensure that your employees are getting the care that they need and that your business is protected in case the employee considers any further legal action.
  • Another way you can protect your staff is to provide them with the training they need in order to do their job safely. This includes performance training, like how to operate machinery and perform basic job functions, but it also includes respectful workplace trainings which include sexual harassment training. Not only will this step help your staff feel more confident and comfortable at work, but it can help bolster your case if your business encounters any legal issues involving these topics.


3. Abide by state and federal tax laws

Another common issue businesses of all sizes and industries experience is issues with paying and filing their taxes appropriately. Depending on how you choose to form your business (LLC, S-corp, sole proprietorship, etc), your business will be subject to a certain set of tax regulations. Not filing accordingly could put you in a bad position with the IRS and/or your state’s tax organization. Resulting penalties could include fees, collection actions, and litigation.

In short, dealing with tax issues is never easy, nor is it something you want to add onto your plate. To avoid these issues, you might consider working with a tax preparer or using online tax software system to ensure you’re filing and paying your taxes according to governing regulations.


4. Focus on customer service

If you’re a larger company with a lot of customers, another legal issue you might have to worry about is consumer litigation. If customers are dissatisfied with the quality or safety of your product, they may file a class action lawsuit in certain circumstances. If enough customers are upset about the issue and legal action is pursued, the damage to your brand can be seriously crippling.

How can you avoid this situation? Take customer feedback and complaints seriously. If you hear about or notice a quality issue in your product, do something about it, even if it means that you have to recall inventory or take a small financial hit. These consequences will likely be far less concerning than a class action lawsuit.

Final Notes

Dealing with legal issues is never fun…no matter how big or small your business is.

Use these tips to help you take precautionary measures to avoid these issues altogether!

And if you need help putting these plans into motion, simply seek help from the #1 business contract lawyer or email sam@mollaeilaw.com

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