So you're starting a new business. This is a new beginning for you, and opportunity and success are hopefully on the horizon. You may have analyzed your business decisions in advance and strategized to make your new venture profitable.
But what about legal strategy? There are many common legal mistakes that new business owners make that can sabotage their ability to be successful in the future. Our Chicago business attorney at Ellis Legal explains more below.
Employment Laws
One common mistake is failing to account for the numerous employment laws, which can lead to trouble. From the Fair Labor Standards Act to the Americans With Disabilities Act to workers' compensation laws to OSHA regulations and everything in between—it's easy to get lost in the nuances and details of so many state and federal employment laws.
Does your business have policies and procedures to address these laws? Is there a policy and procedure where aggrieved employees can address complaints? Do you really know when employees must be paid overtime pay? These are things that shouldn't be overlooked when starting a business.
Remote Work and Personal Devices
In today's world, we do work remotely—even if our jobs aren't entirely remote. But what happens to your important and sensitive corporate information that may be on your employees' personal computers or devices that they use when they are working out of the office?
Even if you don't have full-time work-from-home employees, a device policy, as well as policies that address what property belongs to the company and how to get that information back when the employee leaves, are vital to protecting your trade secrets and confidential company information.
Intellectual Property
Companies often design slogans, jingles, or logos—or even name the business—without giving any thought to whether they actually own the intellectual property that they are using.
Searches for all IP—your company names or slogans—should be done in advance, as should securing domain names online. And if you're using outside contractors to do any design work or musical works for your company, you'd better make sure that you, and not they, own the rights to what they create or what you are using.
Corporate Documents
Many businesses just want to get started and operate as soon as possible. Things like bylaws, procedure manuals, management agreements, or other documents that serve as the "rulebook" for how your company will operate are often overlooked or else just given a cursory bare-bones treatment (often with some random forms people find online).
Make sure you take the time to draft comprehensive governing documents that work for your specific company and that they cover all possible contingencies.
Mixing and Commingling Funds
In a smaller company, it can be easy to commingle money. The company pays for your personal car. You pay personally for some office equipment. The company's PayPal account is deposited into your personal bank accounts.
Even if you're not stealing anything, and all funds are accounted for, you're still commingling your personal funds and the company's funds.
Take the time to separate the two and have corporate resolutions if the company will be paying personal expenses for any owner or manager of the company. Otherwise, you could end up losing the corporate legal protection that normally comes when you incorporate.
Speak with a Chicago business and corporate attorney at Ellis Legal at (312) 967-7629 today to avoid legal problems later on.