Free Enterprise - The FindLaw Small Business Law Blog

February 2012 Archives

Give Time Off for Jury Duty or Risk Fines, Lawsuits

If an employee gets called for jury duty, is time off from work something you need to give? Many employers might wonder whether or not there are any specific jury duty laws in their state.

There probably are. And it's vital that employers familiarize themselves with the relevant statutes.

Violating state laws can result in penalties. So what do you need to know?

Does Your Dress Code Go Too Far?

Are your employees a little bit too... scruffy and unkempt? Businesses have multiple reasons to institute a dress codes and grooming policies.

A polished, clean-looking workforce can be essential in your field. Customers need to be able to trust your employees. They should also feel comfortable talking to your workers.

Employees that show up like Cousin Itt from the Addams Family may not make the best impression. But business owners should know that sometimes dress code policies can end up breaking the law.

How to Handle References for Fired Employees

If it hasn't already happened, there will come a day when you receive a phone call requesting an employment reference for a fired employee. The request will undoubtedly put you in a difficult position.

You're probably aware that a bad reference can turn into a defamation or tortious interference lawsuit. But did you know that not telling the truth can also get you in a little bit of legal trouble?

Well, it can. You can be held liable under the tort of negligent misrepresentation.

Top 5 Legal Tasks You Should Do This Year

Guest post by Jennifer K. Halford, Esq.

There always seems to be plenty of advice at the end of the year about legal tasks that small business owners need to complete. Yet, if you are like most of my clients, December is too busy with holidays and vacations and January and February are equally hectic. OK, but no more excuses. 

Now that we're staring down March 1, here are five legal tasks that I recommend my small business clients complete to start the new year off right:

Top 5 Reasons to Hire a Tax Lawyer

As a small business owner, should you hire a tax lawyer? You may feel like the answer depends on the complexity of your tax filing, or the size of your business.

But because the IRS makes almost no room for errors, the benefits of hiring a tax attorney will almost certainly outweigh the costs. Here are five reasons to hire a tax lawyer for your small business needs:

Using Social Media for Hiring Can Get you Sued

Guest post by Jennifer K. Halford, Esq.

I recently overheard two job seekers speaking about their plans to ensure that their LinkedIn and Facebook profiles are "employer appropriate."

It is not surprising that there has been an increase in the number of employers, particularly small business owners, who screen candidates' social medial profiles. Small business owners want to ensure that the individuals they hire are right for their business.

It takes time, resources, and money to hire and train someone. A profile may reveal photos of a candidate partying, abusing illegal substances, or engaging in other questionable behavior. The information is readily available and free. It could help you avoid hiring someone who is not the right fit for your business.

Google Gives Small Businesses Free Websites

Small business owners in Georgia and South Carolina are the latest to gain access to Google's "Get Your Business Online" program. Launched in July, the program is designed to increase small businesses' online visibility.

Google, along with its partners, will help small business owners build a free 3-page website; provide a free custom domain name and hosting for one year; and list the business on Google Places at no cost.

It's supposed to be really easy, too.

Lesson: Don't Call Regular Customers Racial Slurs

Here’s a tip that all businesses should take to heart: do not call customers racial slurs on receipts. You could be sued. This is the very reason why Orange County restaurant Landmark Steakhouse is faced a lawsuit.

African-American patron Mark McHenry was a regular at the restaurant. He thought he was getting along well with the restaurant staff. That is, until he saw a glimpse of some receipts.

Restaurant employeeshad identified him using different variations of the N-word. That is when he sued for race discrimination.

NY Caterer Not Kosher, Cheated on Tips: Suit

Can you confiscate employee tips?

This is one of the questions being asked in a lawsuit filed against Morrell Caterers, one of the largest of such companies on Long Island. Approximately 500 servers, busboys and maitre d's claim they were forced to turn over cash tips they received while on the job.

The Morrell Caterers lawsuit further accuses the company of fraudulently telling customers a "service charge" would be distributed amongst wait staff.

How to Get New Tax Credit for Hiring Veterans

You may have heard about General Electric's plan to hire 5,000 veterans in the next five years. While the move may be motivated by moral responsibility, the company has a financial incentive, too. There are new tax credits for hiring veterans.

The VOW to Hire Heroes Act, signed into law in November, extended up to $9,600 in tax credits to employers who hire unemployed veterans. The rates are per-employee and apply to qualified veterans who begin work before January 1, 2013.

The IRS has issued a clarification regarding the new Form 1099-K and how to report 1099-K amounts on your business taxes.

Business merchants who use third-party payment-processing companies for credit-card and e-commerce transactions should have received a Form 1099-K from each of those processing companies by Jan. 31. (This is only required for merchants with at least $20,000 in processed payments and at least 200 transactions last year.)

So how should you report the amounts from Form 1099-K on your business tax return?

A new type of "flash mob" is targeting small businesses, and struggling retailers couldn't be happier. "Cash mobs" are drawing hundreds of new customers, and creating buzz at the speed of social media.

"Flash mobs" are made possible in part by Twitter and Facebook. People send out a call to converge in the same place at the same time for the same purpose. Famous flash mobs have led to huge public pillow fights, mass-choreographed dances, and surreal sights like people "frozen" in mid-movement.

Now the flash mob fad has spread to struggling mom-and-pop stores: Groups called "cash mobs" gather at a store, and a shopping spree ensues, MSNBC reports. The trend is taking off -- and paying off -- across the country.

Am I Legally Required to Approve Doctor Appointments?

There’s always that employee — the one that tells you last-minute about a doctor’s appointment, or schedules one when he has no more paid time off. It’s usually during a busy time, too.

Before you respond and decline the request, stop and think about the situation. Ask yourself whether you are legally required to give that employee time off for a doctor’s appointment.

In some circumstances, you may have to.

Thieves Are Stealing Grease from Restaurants Now

Beware! Grease thieves are on the loose.

San Francisco restaurants are the latest establishments to fall prey to these thieves. They come in the night, and siphon off used cooking oil stored in metal barrels behind the restaurants. When recyclers come to take the waste off their hands, it's already gone.

Used cooking oil is worth about 50 cents a gallon.

Can Pinterest Help Your Small Business?

The latest and greatest social network is none other than Pinterest, an online bulletin board system. Founded in 2010, the site already has 7 million unique visitors -- and it's even found a way to start earning money.

The beauty of Pinterest is that it drives traffic to websites that may otherwise see few visitors. If done right, it can also link users to products you sell through your own website or affiliate programs on sites like Amazon.

Pinterest and small business seem like a match made in Internet marketing heaven.

Think Twice Before Giving Workers a Polygraph

Do you think your shifty-eyed cashier is lying to you about how much cash was left in the register last night? Or, do you have the sneaking suspicion that your supposedly Ivy League-educated accountant is actually a big fraud?

You might want to hold off on conducting employee polygraphs. The Employee Polygraph Protection Act (EPPA) largely prohibits employers from using lie detector tests.

And most likely, the EPPA does apply to you.

How a Blogger Can Do $2.5M in Damage to a Company

Sometimes you may want to sue a blogger for what they write about your company or your products. Obsidian Finance did just that, and prevailed. They sued blogger Crystal Cox. During the trial, Obsidian alleged she defamed the company with some of her Internet posts.

Obsidian won $2.5 million in damages last year. Cox had accused the company of criminal behavior.

But Cox wasn't done fighting yet. She sought a new trial in January. The Electronic Frontier Foundation (EFF) also filed an amicus brief in support of her case. They argued that the award against Cox should be overturned in the interest of free speech.

The IRS' new 1099-K form is seen by some as so burdensome for small businesses, two lawmakers are pushing for a new federal law to scale it back.

The 1099-K Overreach Protection Act would prohibit the IRS from fully implementing the 1099-K form, the website reports. Rep. Aaron Schock, R-Ill., introduced the bill in the House on Feb. 1; Sen. John Thune, R-S.D., is set to propose a similar bill in the Senate.

1099-K forms are meant to give the IRS a better way to keep track of e-commerce transactions, and to make sure merchants' numbers are correct. But critics say it's confusing and unnecessary.

Obama's Startup America Helps U.S. Entrepreneurs

President Obama marked the 1-year anniversary of the Startup America Partnership on Tuesday by announcing his legislative plans for the program.

The so-called Startup America Legislative Agenda is designed to increase innovation in regions and sectors where entrepreneurship is lagging behind. It includes a wide-range of bills that target taxes, immigration, federal programs and initial public offerings.

Startup America chairman Steve Case believes the following measures will reinvigorate America's entrepreneurs.

What is a 501(c)(3) Exempt Purpose?

Are you looking to create a non-profit 501(c)(3) organization? If so, you'll need a 501(c)(3) exempt purpose.

Many entrepreneurs endeavor to create a non-profit organization. There's that part of us that craves to do some good in the world.

But there is a difference between becoming a non-profit and becoming tax-exempt. In order to become tax-exempt, you typically need to file an application with an IRS. Many non-profits will fall under the 501(c)(3) tax-exempt organization umbrella. But to get there you will need a proper purpose. It's mandated under the IRS code.

FDA Sued for Monitoring Employees' Private Email

The FDA is being sued by several current and former employees for monitoring their private emails. Receiving and sending private emails on a work computer are things many employees may do.

Yet many may not realize -- or understand -- what level of privacy their actions are afforded.

The employees allege the government agency illegally monitored their correspondence. They also claim the FDA's actions had a negative effect on whistleblower activity.

The former FDA workers say that the agency only started monitoring activities after some voiced their concern to Congress. The employees ranged from doctors and scientists. They contacted politicians to express their belief that some approved medical devices might be too dangerous for patients.