Free Enterprise: September 2010 Archives
Free Enterprise - The FindLaw Small Business Law Blog

September 2010 Archives

How To Check Employment Eligibility

In a surprising turn of events on September 29, the former housekeeper of California gubernatorial candidate Meg Whitman held a news conference to make allegations of abuse and that Whitman knew of and ignored her immigration status. Former housekeeper Nicky Santillan is claiming she is owed wages and other compensation by Whitman. She further claims Whitman was aware of the fact she was undocumented, but did not fire her for it until she began her campaign for governor.

Although no claims have been proven, and Whitman's representatives say Santillan misrepresented her status to both Whitman and to the agency Whitman used to hire her, this event brings up questions regarding workers and responsibilities of small business. Large corporations have large human resources departments to handle background and immigration status checks on all employees, but what about a small business owner?

New Small Business Law Passes: What it Means

Claiming desperately needed good news for both his party and his country, President Barack Obama signed the new small business assistance bill into law today. When the nation is still struggling with a 9.6% unemployment rate, assisting the small businesses who are said to supply most of the jobs in the American economy is a must.

According to USAToday, small businesses were hit by a "one-two punch" in the recession, the President told the press on September 27. These companies faced not only reduced spending by consumers and a lack of demand for products, but at the same time, the financial crisis tightened the credit markets, making it harder for small businesses to get loans. This new small business law will help, the President said.

Small Business and Groupon: Not a Good Match?

Small business and Groupon: owners are talking about the online company; the benefits, the drawbacks and the out and out fakes. A story has been reported this week about a small business owner, an Atlanta photographer, who is being accused of promoting a fake deal on Groupon. According to the complaints of Groupon customers, the photographer couldn't live up to the terms of the deal and what is more, may have been promoting her site with pictures she did not own.

Photographer Dana Dawes is dealing with complaints and allegations that her work is not her own and that she cannot possibly live up to the deal she sold on Groupon which earned her about $76,000 according to PetaPixel. Whether it is a case of fraud or just serious misjudgment about the ability of her small business to deliver such a volume of work is just one question. As one photographer who commented on the deal said, "Groupon - one major clue that the business is fraudulent is if they offer a deal like this, that cannot be physically fulfilled by a true professional photographer ... It is physically impossible for a pro photog full time to do 1,000 sessions in a year (and on location at that)."

LA May Expand Health Grades to Food Trucks

Los Angeles is a city full of cars. It is no wonder then that mobile food trucks have been a wildly popular source of nourishment for the city dweller. Food trucks have been a staple in the sunny Southern California city for years, catering to everyone from construction workers to corporate big wigs. The movable food trend has been so popular in LA that stationary companies have put their food on four wheels as well, often posting their route on facebook and twitter. Even the Food Network has a show searching for the top food trucks across the nation.

And now enter Public Heath. Los Angeles County Supervisors are scheduled to vote on whether to expand restaurant health grades to food trucks. The heath inspection letter grade gives a restaurant an A, B, or C rating based on an inspector's determination of a restaurant's hygiene practices. The letter placard must be displayed in a store window for potential customer's to see -- a practice that has helped increase awareness of safe practices and reduced the risk of food-borne illnesses in the area.

Proposed Tax Breaks Helpful for Small Business?

Small businesses are getting big attention from Washington these days. Obama's latest attempt to help small businesses comes in the form of $200 billion in tax breaks for businesses that invest in new equipment and plants. The proposal allows business owners to write off 100% of the investment in just one year, rather than through a series of deductions over a number of years. The Small Businesses Job Act will also double the current expensing limit to $500,000.

CNN quotes Bill Rys, tax counsel at the National Federation of Independent Business: "While the increased expensing limits for business investments may help some businesses, most small businesses aren't making expenditures that exceed the current $250,000 expensing limit." Although some businesses will benefit, most will not need to or be able to take advantage of the proposed tax break. CNN goes on to note that extension of the Bush-era tax breaks would be a more welcome form of business security as many small businesses are concerned over increased tax liabilty when the breaks expire at the end of this year.

Small Business Workers' Compensation: 5 Things to Know

When it comes to workers' compensation insurance, small businesses always have plenty of questions and concerns. In this post, we will go over five things to know about small business workers' compensation.

1. Pay attention to the number of individuals on your payroll. In many states, exceptions to workers' compensation laws apply to employers who have a small number of employees, such as five or less employees. If you are under the minimum, you are not required to carry workers' compensation insurance. However, even if it is not required, you may want to provide it anyway for the benefit of your employees and the company.

2. Pay attention to the classification of individuals on your payroll. For example, not all employees are required to be covered under your small business workers' compensation program. Typically only full-time employees must be covered. Part-time employees, contractors and interns are often exempt.

IRS Offers Small Business Guide to Tax Audits

When the tax man comes knocking at the door of a small business, the visitor can cause an owner to go dizzy with questions of what to do next, and how best to handle the overall tax audit process. And who better to answer those questions than the Internal Revenue Service, which now offers small businesses a guide to tax audits. The video series entitled, "Your Guide to an IRS Audit" is a step-by-step guide to a small business audit.

The tax tutorial is told from the hypothetical perspectives of an auto repair shop, a computer repair shop, and a flower shop owner to help those faced with a small business audit navigate his or her way through the process as smoothly as possible. The video, which can be viewed at any time, is a welcome visual and audio addition to the webpages full of information on the IRS website. And for those small business owners in need of a popcorn break, a convenient "bookmark" feature allows a viewer to leave and return to specific portions of the video.

NY Restaurant Owners and Chefs Sued For Wages

So a lawyer walks into a restaurant ... It sounds like the beginning of a lawyer joke and it could be; but this time, is the joke on the restaurant owners? Lawyers in Manhattan, one of the centers of the culinary universe, are after some very high-profile restaurant owners and chefs for what they say are illegal wage practices. Like big names Mario Batali and Bobby Flay, now other high-profile chefs are the subjects of suits claiming their employees are made to share tips, denied overtime and are not paid the minimum wage required.

According to the Wall Street Journal, suits have been brought against Chef Michael White and his partner Chris Cannon, who run the highly-regarded "Alto" in midtown Manhattan (among others), as well as world famous Iron Chef, Masaharu Morimoto. In Morimoto's case, the plaintiff is former bar-back, Jose Bueno, who alleges he was made to share tips with non-service workers and did not receive the full 20% service charge for serving private parties with more than 12 people.