Starting a business goes beyond coming up with a cool name, products, services, marketing, and sales strategies. While these are the more exciting and prominent aspects, entrepreneurs have other factors to consider. A significant area of concern is a business’s legal obligation to follow federal and local laws while assuring quality products and services to their target customers.
From providing a safe and decent environment for employees and customers to complying with federal, state, and local regulations, failure to implement effective strategies and take necessary precautions could ruin your chances of success. Whether you’re in the beginning stages of starting a business or you’ve been operating for years, here are some legal aspects you don’t want to forget.
Legal Structure
One of the first things an entrepreneur should consider is the legal structure of their business. Establishing a legal structure is mandatory on local, state, and federal levels. It is also essential for keeping personal and professional assets separate. Evaluate your options and determine which structure works best for your business. Then, register your business with your local clerk’s office to make it official.
Tax Identification Number
All businesses are responsible for paying their state and federal taxes. Without the proper identification number, this process is impossible. After registering your business as a legal entity, ensure that you have applied to receive an employer tax identification number (unless you plan to use your social security number).
Insurance Coverage
Though the hope is that you can operate your business without any hitches, the reality is that anything could happen. From occupational hazards in the workplace to dissatisfied customers, an unforeseen event can negatively impact company finances. While you should do what you can to prevent these things from happening, you should also invest in insurance.
Insurance serves as financial protection for businesses that encounter circumstances beyond their control. For example, if an employee is injured on the job, worker’s comp insurance covers the cost of everything from time off to medical bills. Similarly, general liability insurance protects businesses if a customer files a lawsuit due to poor products or services.
Legal Representation
While insurance covers the cost of a worker’s compensation claim or civil action taken by a disgruntled customer, it doesn’t provide legal assistance. If a business comes under fire for any reason, having legal representation is ideal. From their extensive knowledge in business law to innovative resources like remote depositions and a mock jury, corporate lawyers help businesses navigate the legal process. Their knowledge and experience not only help you get the best outcome in the courtroom, but it can help you establish practices to prevent legal ramifications in the future.
Health and Safety in the Workplace
Employers have a moral, social, and legal obligation to ensure they provide a safe and healthy workplace. An establishment where morale is low and injuries are high is a disaster waiting to happen. Therefore, entrepreneurs must take steps to support their staff’s wellbeing and meet the requirements of local, state, and federal laws.
Familiarize yourself with health and safety regulations and building codes and invest in strategies and services to remain in compliance. Hire an auditor or outside expert to evaluate the facilities and operations to identify areas of weakness. Prioritize employee needs by holding regular group and independent meetings to identify concerns. Then, boost workplace morale by implementing solutions to address employee concerns.
As employees’ needs change, businesses must be open to regularly changing their facilities, workflows, and structure to accommodate those needs.
When deciding to start a business strikes, don’t get so caught up in the obvious that you forget the most significant steps to a successful business. Keeping in mind that starting a business comes with legal obligations, entrepreneurs must invest time in ensuring that those demands are met. From legal structure to workplace safety, develop a system that safeguards your brand against potential threats. By using the advice provided above, you can have peace of mind in knowing that your business is protected.
