Free Enterprise - The FindLaw Small Business Law Blog

July 2014 Archives

3 Legal Tips If Your Business Is Flooded

If your business is flooded, you need to get on top of your legal to-dos, or you'll be financially underwater.

Just look at what happened to UCLA's campus after a water main burst, sending more than 20 million gallons flowing through the campus. While the Los Angeles Times suggests that the UCLA incident may be more of a red flag for the city's infrastructure, business owners should be ready to mitigate flood damage no matter what the cause.

Here are three legal tips to consider to keep your business high and dry after a flood:

Restaurant's Loud Kids Ban May Sound Harsh, but Is It Legal?

Business owners may often endure screaming children alongside paying customers, but they may not have to.

A Northern California restaurant heard an awful lot of complaints after it posted a sign announcing its new policy: No loud kids in the dining room. According to Monterey's KSBW-TV, the Old Fisherman's Grotto restaurant in the city's historic Old Fisherman's Wharf has also barred strollers, high chairs, and booster chairs.

Can your business put a loud-kids ban like this in place?

5 Legal Tips for Using Customer Testimonials

Customer testimonials can be a great tool for small businesses with limited marketing budgets.

After all, what better way to show customers you can get the job done than ringing endorsements from previous customers? But if you're thinking of using customer testimonials for your business, there are a few things you should keep in mind.

Here are five legal tips for using customer testimonials in your marketing materials:

NLRB: McDonald's, Franchisees Both Liable for Worker Treatment

The National Labor Relations Board's General Counsel has ruled that McDonald's is jointly responsible for treatment of workers at its franchisees' restaurants.

The ruling comes amidst the NLRB findings that of the 181 unfair labor practice complaints filed against the fast-food chain and its franchisees over the last 20 months, at least 43 had merit, reports The New York Times. Complaints in these cases include allegations that workers were fired and threatened for pro-union activities. McDonald's will now be considered a "joint employer" in those cases, which could make the company legally responsible for violations at franchisee locations.

What was the rationale behind the ruling and how might this ruling affect McDonald's and other large fast food chains?

  • Need legal advice on how your small business should operate? Consult with an experienced business attorney about your options.

Declined Debit Card Override Scam: What Businesses Need to Know

Have you heard about the declined debit card override scam? If not, a recent case involving a young Florida man offers an eye-opening lesson for business owners.

Investigators say the man was able to make more than $300,000 in fraudulent purchases from Apple stores across the country, using a simple scam that's somewhat ingenious. Sharron Laverne Parrish Jr., 24, allegedly made 42 purchases at Apple stores in 16 states by using a declined debit card override scam known as the "forced code" or "forced sale" scam, reports Business Insider.

How does the scam work, and what can you do to avoid being victimized by it?

NLRB Puts Brakes on Mercedes-Benz Policies That Impeded Unions

The NLRB has ordered Mercedes-Benz to remedy three labor law violations in one of its plants, mostly by revising solicitation policies with regard to unions.

An administrative law judge ruled Thursday that employees at the car manufacturer's Vance, Alabama, plant was violating employees' Section 7 rights by prohibiting soliciting for any purpose in the office -- even in "mixed use" areas, reports The Tuscaloosa News. Small business owners should be wary of even "neutral" policies that might stifle union participation, and Mercedes-Benz learned that the hard way.

Here are three takeaways for business owners who may not be the size of Mercedes-Benz:

5 More Types of Insurance Your Small Business May Need

As we've recently discussed, your business may require various types of insurance to protect it from the unpredictable storms of liability. But as you might imagine, it was impossible to cover all of the many helpful types of business insurance in the same digital breath.

For example, what about employee health insurance? Or insurance for corporate events? We hear you.

Now that we've had a breather, here are five more types of insurance your business may need:

3 Business Lessons From Michelle Phan's YouTube Copyright Suit

YouTube star Michelle Phan has been slapped with a copyright-infringement lawsuit over her use of background music in her makeup tutorials.

The do-it-yourself online makeup sensation is accused of rising to commercial success by illegally using copyrighted music by artists like Deadmau5 and Kaskade in her videos. While Phan insists she didn't infringe on any copyrights, business owners may be wondering: Isn't there a way for entrepreneurs like Phan to use music without being sued?

Learn from Phan's copyright suit with these three business lessons:

Are Work Clothes, Uniforms Tax-Deductible Business Expenses?

Many small business owners who deduct expenses for work clothes and uniforms on their taxes may want to look a bit closer at the tax rules. It turns out that many entrepreneurs choose to write off expenses that may not actually be tax-deductible at all, including clothing.

So are your business’ work clothes and/or uniforms tax-deductible expenses? Here are some general guidelines:

Is Kickstarter or Crowdfunding Money Taxable Income?

Small businesses may be very successful raising funds through Kickstarter, but those who receive those funds shouldn't forget the potential tax implications of crowdfunding.

For its part, Kickstarter (with the caveat that they are not tax attorneys) claims that in general, "funds raised on Kickstarter are considered income." However, the crowdfunding platform also claims that Kickstarters may be able to classify certain funds as "nontaxable gifts" instead.

So which is it? Should businesses treat Kickstarter or crowdfunding money as taxable income?

Obama Bars Anti-Gay Discrimination by Federal Contractors

President Obama has signed an executive order barring the federal government and its contractors from discriminating against gay, lesbian, bisexual, and transgender employees.

Private employers in many states can still fire employees based on their sexual orientation or gender identity, so this executive order gives a new layer of employment protection for some LGBT workers. The Huffington Post reports that this order does not include an exemption for religious employers.

How exactly will this executive order change employers' anti-discrimination policies?

Yahoo! Exec Accused of Harassment Countersues for Defamation

A Yahoo! executive who's being sued over alleged sexual harassment has countersued her accuser for defamation.

Maria Zhang, Yahoo!'s Senior Director of Engineering, filed suit against Nan Shi, the woman who accused her of coercing her into multiple sexual encounters for fear of her job. Zhang claims in her countersuit that the allegations are entirely false and that Shi's only goal is "financial gain," GeekWire reports.

Could Zhang's accuser be facing more liability than the Yahoo! exec?

Renting Musical Instruments via Sparkplug: 5 Sound Legal Tips

The Internet's sharing economy -- fueled by breakthrough startups like Airbnb and Uber -- has made its way into a somewhat unlikely new area: musical instruments.

A new service called Sparkplug allows musicians with musical instruments, gear, or practice spaces that aren't being used to rent it out to other musicians who may need it. Unlike Craigslist, eBay, or other sites where users can buy and sell musical gear, Sparkplug allows musicians with valuable equipment to generate income during downtime without having to part ways with a prized musical instrument or hard-to-find amplifier.

Sound like something you'd be interested in? Here are five legal tips for using this new musical sharing service:

7 Legal Tactics That May Help You Avoid Layoffs

Layoffs are an unpleasant task for any small business, and if they can be avoided, all the better.

That may have been a discussion within Microsoft prior to its announcement that the company would be cutting 18,000 jobs. The New York Times reports the tech giant will be making the lion's share of cuts from its Nokia-acquired groups -- about 12,500 jobs. Severance pay and other layoff costs add up for any company, and Microsoft estimates it will dole out between $1.1 to $1.6 billion to cover the massive cuts.

While your business isn't as big as Microsoft, you may be able to avoid layoffs by considering these seven legal tactics:

5 Business Lessons From Disney Lawsuits

Iconic American theme park Disneyland opened 59 years ago today.

And as you might imagine, over the last six decades, Disneyland and its parent corporation Disney have been involved in a fair amount of litigation, from personal injury lawsuits to intellectual property disputes.

Here are five lessons your business can learn from Disney's long legal history:

Is It Legal to Post Business Surveillance Video Online?

It legal to post business video-surveillance footage online?

Many businesses employ video surveillance systems, and the footage can often result in useful -- or humorous -- clips that somehow find their way onto YouTube, Facebook, or other websites.

While it is likely legal for businesses to use security footage for the purpose of preventing theft, or even to track down criminals, murkier legal waters await businesses who are posting security cam footage just for laughs. Here's what business owners need to know:

EEOC's New Pregnant Worker Guidelines: What Employers Need to Know

The U.S. Equal Opportunity Commission has released new guidelines for the enforcement of laws prohibiting workplace discrimination against pregnant women.

These are the first new federal guidelines on pregnancy discrimination in more than 30 years, reports The Washington Post. The document, titled "EEOC Enforcement Guidance on Pregnancy Discrimination Related Issues," seeks to clarify the federal rules on discrimination against pregnant workers under both the Pregnancy Discrimination Act and the Americans with Disabilities Act.

What do employers need to know about these new guidelines?

5 Types of Insurance Your Small Business May Need

Insurance is a necessary part of protecting your business from liability, and as the need for protection grows, so has the field of insurance.

Whether you want to safeguard your business' physical property, prepare for suits from slips and falls, or buttress your online reputation from the slings and arrows of social media, your business needs to be insured.

Check out these five key types of insurance your small business may need:

Does Your Business Need an Intellectual Property Audit?

It's 2014. Do you know what your business' intellectual property is doing?

If you didn't answer with an emphatic "Yes!" (or worse yet, had to stop and think about what exactly intellectual property is), then you may be a prime candidate for an IP audit.

What exactly is an IP audit, and what can it potentially do for your business? Here's what business owners need to know:

Female Yahoo! Exec Accused of Employee Sexual Harassment

A high-level female Yahoo! executive has been accused by an ex-employee of sexual harassment, including allegations she coerced the employee to have "oral and digital sex" with her.

Nan Shi, the employee who filed the sexual harassment suit, accuses Yahoo! Senior Director of Engineering Maria Zhang of forcing her to have sex with the promise of "a bright future at Yahoo!" According to the San Jose Mercury News, Shi claims Yahoo! eventually fired her after she reported the abuse.

What does Shi's lawsuit claim about this female Yahoo! exec?

B&N's Breastfeeding Mom Settlement: 3 Lessons for Businesses

Bookstore chain Barnes & Noble's recent settlement with New York's Attorney General should be a warning to business owners: Breastfeeding moms usually have the law on their side.

In the New York case, a woman breastfeeding her 5-month-old child was asked to cover up or leave by a Barnes & Noble manager, who said that uncovered breastfeeding was "against store policy." After the woman filed a complaint, the Attorney General stepped in to remind Barnes & Noble that breastfeeding in public was definitely encouraged by state policy, not to mention state law.

Here are three lessons your business can learn from Barnes & Noble's breastfeeding brouhaha:

Starting a Brewery: 5 Steps to Keep Lagers Legal

So you're starting your own brewery. You have a vision, you have the passion, and your beer is going to blow people's freakin' minds! But you need to get your legal ducks in a row or your beer dreams might amount to nothing more than suds.

Don't let your brewery plans go flat, check out these five steps for keeping your lagers (or ales, pilsners, etc.) legal:

What Is a Closely Held Corporation?

Small business owners who incorporate may wonder if their company is considered a "closely held corporation," especially in light of the U.S. Supreme Court's recent Hobby Lobby decision.

As you probably know, closely held corporations like the craft-store chain Hobby Lobby are now eligible for an exemption from Obamacare's contraceptive mandate, so knowing the distinction can have real legal consequences.

So what exactly is a closely held corporation?

5 Big Mistakes That Can Shut Down Your Business

Making a few mistakes can be a great way to learn tough lessons about running a business. But some mistakes can cost you more than just your confidence; they can lead to your business being shut down -- maybe for good.

What are some of the worst mistakes you can make? Here are five big ones that can put your business out of commission:

Firing a Worker? 3 Simple Tips That May Prevent a Lawsuit

As an employer, sometimes you're left with no choice but to fire a worker.

However, firing a worker improperly can come back to haunt you in the form of a wrongful termination lawsuit. And while you can't control a former employee's decision to pursue legal action, you can certainly make the prospect significantly less appealing by decreasing the odds of any such suit being successful.

Here are three simple tips that may keep fired employees from firing up a lawsuit against you:

Social Media Training: 5 Legal Topics to Cover With Your Staff

Social media training is essential for any employer who wants his or her staff to help a business' online presence to thrive.

But there's more to this training than just making sure your employees know how to log on to Facebook and Twitter -- there are a few legal points you'll want to cover as well.

If you're unsure where to start, try these five legal topics on social media to cover with your staff:

When Is a 'Business Lunch' Tax-Deductible?

When you’re a small business owner, pretty much any meal is a tax-deductible business meal, right? Not necessarily.

The IRS has very specific rules for what is, and what isn’t, considered a business meal for tax purposes. And unfortunately for many small business owners, eating lunch at your desk will most likely not be considered a tax-deductible business meal.

So what are the rules for when a meal can also be a write-off?

Bitcoin Extortion Scam: 3 Things Business Owners Should Know

A handful of businesses have begun receiving "notices of extortion" demanding that the owners pay the senders in Bitcoin to avoid bad online reviews.

For some reason, the scam seems to be targeting pizzerias around the United States, including Manchester, New Hampshire-based 900 Degrees Neapolitan Pizzeria. General Manager Michelle Doucette told the New Hampshire Business Review she thought it was a joke and had to ask what a Bitcoin was.

Whether or not you've received a similar extortion letter, here are three things business owners should know:

Opening a Food Truck? 3 Potential Legal Issues

Food trucks are all the rage these days, allowing both entrepreneurs and established restaurant owners to take their culinary shows on the road.

But with the rewards come unique risks. As shown by Tuesday's explosion of a Philadelphia food truck, even a truck-sized food business can present potential legal liabilities.

If you're thinking about getting behind the wheel of a food truck, what should you be aware of? Here are three potential legal issues to keep in mind:

Tinder Sexual-Harassment Lawsuit: 3 Lessons for Business Owners

As dating app Tinder is being sued by an ex-vice president for sexual harassment, the startup's alleged missteps can offer a few lessons for small business owners.

Ex-VP of marketing Whitney Wolfe claims that Tinder's executives bombarded her with sexist and insulting comments, emails, and texts, and that high-level execs at Tinder's parent company IAC/InterActiveCorp did nothing to stop it. An IAC spokesman told The New York Times that Wolfe's claims were "unfounded."

As the case proceeds, here are three lessons that business owners can glean from this Tinder sexual harassment suit:

Are 'Microaggressions' Costing Your Business?

Business owners shouldn't tolerate racial slurs or jokes in the office, but microaggressions may be sliding past their radars -- and costing their businesses.

Microaggressions are seemingly slight forms of non-physical aggression using bias or stereotypes to call attention to a person's (usually racial) differences. Writing for The Huffington Post, John Fitzgerald Gates notes that "[m]icroagressions are the negative assumptions we make about people that limit their humanity and value."

What should business owners know about microaggresions, and how can they potentially cost your business?