Owning a business may be one of the most exciting endeavors you ever undertake, and undoubtedly you will make some common errors. However, it is no secret that being an entrepreneur is also full of challenges. While you have the satisfaction of knowing that you are your own boss, you can set your own hours, and can make the rules for the most part, the responsibilities can be endless. The goal is usually to create a product and keep the customer happy, but you must also consider many other behind-the-scenes issues.
Finding yourself embroiled in a lawsuit may be inevitable if you are in business for a long period of time, but there are preventative measures you can take, to include:
- Creating partnership agreements – your partners may be people you have known for nearly your whole life and trust more than anyone else, but it is important to be realistic and realize that things could go south later, or one or more of you could opt to leave the company. It is critical to have an outline for many different details, starting with the basics such as the hierarchy of the company, responsibilities and titles, profit distribution schedules, to agreeing on what will happen if one partner wants to leave the company or passes away.
- Protect your intellectual property – this means treating all your branding mechanisms with care, to include your trademark, service mark, and any patents your company may have created, along with any copyrights which are generally defined as expressions of art.
- Be sure to have employees classified correctly – this is especially important in California with independent contractors, where employees may be categorized incorrectly, and the company may find themselves penalized. Also, be sure independent contractors have a solid agreement signed before they begin working for you to include the span of the project, their duties, confidentiality, and how ownership of any innovations they create while at your company are to be handled later.
- Employee pay – this is one of the biggest reasons that businesses fall into lawsuits, as overtime may be miscalculated, a paycheck may be late, or there could be errors in accounting. Always make sure that you or your accounting team are completely on top of paying for your employees; after all: that is why they are there!
Do you need legal assistance with a partnership or business dispute? If so, contact the Bolender Law Firm. Our attorneys are experienced in representing clients in state and federal courts, at both the trial and appellate level. Call us at 310-320-0725 now or submit an easy consultation request online. We are here to help!