It is certainly the hope of every entrepreneur that the businesses they form will be successful and avoid legal trouble. However, this is not always the case. When dealing with employees, contracts and customers, there is always the potential for misunderstandings, missteps and disagreements that could escalate.
If you are starting a company or inheriting a family business, you are probably feeling a little overwhelmed with just the day-to-day issues you must contain to keep things running smoothly. The thought of a potential lawsuit may be paralyzing. However, by understanding the types of legal issues that most commonly arise in businesses, you may be able to recognize the factors that could lead to trouble and intercept them before litigation becomes necessary.
Keeping your employees happy
The laws that protect the rights of your employees are complex and dense. They include prohibitions against workplace discrimination, harassment, wage theft and retaliation. Having a thorough understanding of how federal and California laws affect your industry will be an excellent place to begin in shielding yourself from trouble by recognizing wrongdoing in yourself and your co-workers. The most common areas of concern include discrimination or harassment because of these factors and others:
- Sex, race, color, religion and other protected classes
- Pregnancy and family related issues
- Workers over the age of 40
- Hostile work environment due to sexual misconduct
You may also face accusations that you wrongfully withheld wages by failing to pay for work done off the clock, an appropriate wage for the job, or overtime an employee justly earned. The accurate classification of your employees will play an essential role in many wage issues.
Other legal issues
Of course, contracts with your clients, customers and vendors are critical to the smooth running of your business. There may come a time when you or the other party involved dispute the terms of a contract. Claims that one side breached the contract are often difficult to resolve without the assistance of a legal professional, so seeking an advocate will improve the chances that your interests will have protection. Additionally, a legal ally can help you create contracts with clear language that safeguards your rights.
Aside from employee and contract issues, the most common legal issue businesses face is the tort. When someone in your business causes damage to someone’s property or acts negligently resulting in injury, you may face a lawsuit. These claims can be the ruination of a business, so it is best to have good insurance coverage and access to solid legal advice.