Small business owners face various challenges before they can put their business on a steady and profitable trajectory. Business law issues are among one of the important issues that they are required to tackle. With only one person tackling all the business functions, it could be a huge challenge leading to serious distractions. Though wearing multiple hats can provide huge excitement, it can also riddle the path with multiple problems.
To keep you protected from business law issues, we have culled out the following tips:
Familiarity with local labour laws
Before you start your business, you should gain familiarity with the local labour laws. In every jurisdiction, there are statutes that govern the work hours and wages for your employees. There are many components to the labour laws including payment of incentives, entitlement to paid leave, public holidays, financial allowances to cover any expenses incurred as part of the employment, performing specific tasks in specific locations, type of employment, and so forth. To understand the entire gamut of business laws and labour laws in Australia, it is always desirable that you engage the services of a competent lawyer or law firm with adequate experience and exposure dealing with matters related to labour laws. Being completely at home with federal labour laws and business law issues is essential to ensure that the process of hiring and firing employees is smooth.
As a small business owner, you should also be particularly focused on laws that stipulate the work hours, wages and when and how your employees are paid. Overtime payment may be warranted in instances when your employee has to work beyond the stipulated hours and/or the standard workweek. There can also be instances when you may choose to terminate the services of one or more employees in your business either because they were seasonal employees or you have some other reasons to downsize the employee strength. Not being conversant with the laws relating to termination of employment can potentially land you in trouble.
All documentation to be in writing
Experience shows that many small business owners ignore the importance of having important transactions reduced into writing. Sheer optimism that nothing can go wrong does not help here. Ideally, not a single deal should be concluded without appropriate paperwork backing it up. Remember that even when you have a small business, your obligations and liabilities are very similar to large businesses. A mere handshake may seem adequate to conclude a business deal. But, you will realize the folly of not documenting your understandings only when things start going wrong. A written document always helps to put things into the right perspective and potentially stay away from legal hassles.
More importantly, if your contracts are taken to court for any reason, you can find it hard to defend yourself in the absence of a written document. Your oral agreements or commitments do not hold water before the Law. Therefore, it is always a good strategy to have every single business contract or other commitments reduced into writing and signed by all the parties to such agreement/s. Think of a telephonic agreement for the supply of roses on a wedding day. Unless there is a written order specifying the type and quantity of roses, the supplier can be free to deliver roses of his/her choice and any amount of argument may not undo the harm. Written contracts usually cover many ifs and buts as also a dispute resolution process.
Similarly, you may have lease agreements, agreements between you and your clients for the supply of goods or services. To ensure that all these areas are adequately protected, you should always have professional legal help in the form of retainer services or on a case to case basis.
Licensing and taxation
Taxation and licensing is another important area that can land you into serious trouble if you do not have adequate and appropriate knowledge on how they impact your business. Apart from the knowledge your bookkeeping should also be flawless to ensure that you don’t have any trouble with the tax people. It is also equally important that you pay all applicable taxes to the exchequer in time to avoid potential penalties. Not paying taxes in time can get your business itself suspended apart from other legal consequences.
Depending on the type of business you are engaged in, there can be one or more license that you are required to obtain from appropriate authorities. Lawyers conversant with business law issues can be particularly helpful in wading through this maze and ensuring that you have the right license/s at the right time.
Compliance with legal provisions is always mandatory and ignorance is never an excuse before the law.