Free Enterprise - The FindLaw Small Business Law Blog

February 2013 Archives

Do All Start-Ups Need a Stock Purchase Agreement?

Here's an interesting question for small start-up companies:

If you're the sole founder in a company, do you have to write up a stock purchase agreement?

It's a good question for many reasons. For one, it's not one that every entrepreneur would think of asking. Many don't realize the importance of having stock purchase agreements drafted at the early stages.

An Employment Law Primer for Employers

When it comes to labor laws, the regulations aren't collected into a neat package. The system is regulated by different agencies and comes from various sources.

But ignorance and good intentions won't necessarily help you in the face of an employee lawsuit. The law requires you to treat employees in a certain way, and any failure to do that can lead to serious trouble, whether it's intentional or not.

Hopefully your lawyer is helping you stay on top of your legal responsibilities. But it won't hurt to get a crash course in the regulations surrounding employment.

Yahoo's New Telecommuting Rule: Good or Bad?

Last week, Yahoo CEO Marissa Mayer dropped a bombshell on Yahoo's 14,500 employees -- the work-from-home policy would be done by June.

This is a huge shift for the company, which to date, left telecommuting policy in the hands of its individual managers. But ever since Mayer took to the helm last year, she's been taking company matters into her own hands and revamping the one-time Internet leader.

Marissa Mayer's bold new move has raised some interesting questions. First, how should companies large and small handle their telecommuting policies?

Top 5 Tips to Keep Raffles, Contests Legal

Having a raffle or contest sounds like a great way to get some publicity for your business with minimal effort. But is it legal?

It’s true that social media tools make it easier than ever to publicize a contest run by a small business and get lots of people to spread the word about your company. But there are right and wrong ways to go about it. Choosing the wrong way could lead to legal liability.

And, since a contest is such a great way to boost your business that you shouldn’t let these concerns stop you. Instead, just find a way to work within the law. Here are our top tips on how to do just that.

3 Tips to Keep Employee Suspensions Legal

As employers, there are many disciplinary actions you can take against employees. Employee suspension is one of those actions, but it's not always easy to keep employee suspension legal.

Disciplinary actions are usually the first step leading up to a dismissal or firing. But once an employer starts treading those waters, the employer needs to plan carefully.

Wrongful dismissal lawsuits are a huge pain to a company and can be a huge drain to company as well. They can drain not only money, but also precious human resources as they require employees to be pulled away from their work to participate in investigations, depositions and sometimes even trial.

Why Business Owners Need a Living Will

Business owners need to plan the succession of their assets and business properly.

Oddly, a living will could play into some of that. According to a recent FindLaw survey, most Americans don't have a living will.

A living will is a document that spells out what your wishes are if you're still alive, but unable to speak for yourself.

FBI Employees Are 'Sexting': Are Yours?

CNN recently got a hold of a leaked confidential memo from the FBI notifying its workers of problems with employee sexting.

Some FBI employees are issued BlackBerries and apparently a few workers were using these government-issued devices for reasons other than checking emails.

As a result, the federal agency disciplined several employees for acts like sending dirty messages and even one instance of a woman sending a nude photograph of herself to an ex-boyfriend’s wife. If these acts of sexting can happen at the federal bureau responsible for enforcing the law, you may be wondering how you can stop sexting at your workplace.

Trademarking a Slogan Is Easier Than You'd Think

Getting trademarked has never been so easy! You just need to say it, have someone hear it and it’s yours!

Not quite. But a little know fact about trademarks is that a slogan doesn’t need to be registered for you to have the rights to it, according to a recent Forbes piece.

It’s like that old philosophical question — if a tree falls and nobody’s there to hear it, does it make a sound? Similarly, if you say a phrase and nobody’s around to hear it, does it legally belong to you?

For Employee Lawsuits, Trial or Settlement?

What's the best way to respond to an employee lawsuit? Many people want to avoid costly litigation, so there is a prevailing idea that settlement is better than fighting it out in court.

But is that really the case? Is it better to pay off the employee, rather than take the battle all the way to trial?

There are arguments to be made on both sides of the issue.

Businesses: Don't Forget the Disaster Tax Deduction

Businesses have many tax deductions available to them. Those that were in the path of storms like Hurricane Sandy last year might be able to look to the disaster tax deduction, as well as some tax filing extensions.

The Disaster Tax Deduction

The disaster tax break is a great tax break for some. And the interesting thing about the disaster tax deduction is that it doesn't only apply to Hurricane Sandy victims.

In fact, the deduction for casualty loss applies not only to any federally designated disaster area, but it can apply to loss from theft, fires or floods as well.

Late With Your W-2 Forms? Here's What to Do

Are you going to be late in filing your W-2 forms with the IRS? If so, what can you do?

As you probably know, any business that pays more than $600 per year to an employee (in cash or noncash payments) and has been withholding income, Social Security or Medicare taxes from that employee, must file a W-2 form for each employee. These forms should have been sent to employees by February 1.

The next step for business owners is to file your W-2 forms with the IRS. But depending on how you file your business taxes, the W-2 filing deadline may differ as well.

Stop Twitter Hacking: Tips for Small Businesses

For casual observers, it's been fun watching the Twitter hacking that's happened to several businesses over the past few days.

First, hackers got into Burger King's Twitter account to say the company had been sold to McDonald's. (Not true.) Then someone used the Jeep account to say that business had been sold to Cadillac. (Also not true.) A day later, it appeared that similar hackers had gotten into the MTV and BET Twitter accounts, although that was later confirmed to be a PR stunt.

Of course, it's all fun and games when it happens to someone else. But how can you protect your business' Twitter account from online hackers? Here are some tips:

Fired Over Plane Slap: Legally, Does That Fly?

Joe Rickey Hundley has been fired from his job after a plane slap that went viral. Hundley, 60, of Idaho, was charged with assaulting a minor on board a flight Feb. 8.

Jessica Bennett and her adopted son, who is black, were seated next to Hundley on the flight. When the plane began to descend, the 19-month-old began crying and Bennett tried to comfort him. But Hundley was less sympathetic.

He allegedly uttered racial slurs and slapped the child across the face. But even though the incident took place on personal time, Hundley was fired from his job as an aerospace executive. Should his ex-employer now expect a lawsuit?

Legal to Label Your Business 'Sustainable'?

"Sustainable," "green," and "organic" are all words businesses use to display their commitment to the environment. Or at least to greenwash their products and draw in eco-friendly customers.

Even McDonald's is getting into the game by calling the fish for its new Fish McBites and its classic Filet-O-Fish sandwich "sustainable." They're endorsed by the Marine Stewardship Council, NPR reports.

But do you need some stamp of approval to call your business sustainable? And if so, whom do you get it from?

Store Clerk's Sword Thwarts Robbery Attempt

Brian Patel knows how to use a sword when it comes to self-defense. The New Bedford, Massachusetts, convenience store clerk reached for his weapon when a would-be robber pulled a knife on him Tuesday.

The assailant probably thought he had the upper hand with an eight-inch blade. But Patel wasn't ruffled; he knew his three-foot-long sword would scare the man.

And scare it did, as the knife-wielder ran away. But is Patel going to be in trouble for using a sword to thwart an attempted store robbery?

3 Overlooked Small Business Tax Deductions

The new year and the re-election of President Barack Obama brought about a small shift in the economy and in the playing field for small businesses. This year, with the recent fiscal cliff talks, there were some changes made to the taxation of small businesses.

As tax season is upon us, it's a good time to discuss some of these changes.

Here are three overlooked business tax breaks you can claim when you file this year and next:

7 Questions When Hiring a Small Business Lawyer

Hiring the right small business lawyer for your business is critical. But with so many seemingly qualified attorneys out there, how do you know you're picking the right one?

As with most aspects of your business, you will have to do some research, interview several candidates, and ask a lot of pressing questions.

Here are seven questions you should ask when hiring a small business attorney:

$9 Minimum Wage: Good or Bad for Business?

President Obama's State of the Union address touched on many issues, but for businesses the biggest one may be his proposal for a $9 minimum wage.

That's a big jump from the current federal minimum wage of $7.25. Does that mean you'll have to start paying each employee an extra $1.75 per hour to make up the difference?

The federal minimum wage sets the lowest hourly pay for federal employees and those subject to the Fair Labor Standards Act. But how does that affect you? It's not as clear as you'd think.

For Small Business, Disaster Plans Can Pay Off

Families are encouraged to have an emergency plan when things go wrong, but they aren't the only ones who need it. Small businesses can also benefit from a disaster plan.

In the midst of a flood or severe storm that causes irreparable damage, it's hard to think beyond "we've lost everything." But if you've carefully planned out what do in a disaster, it doesn't have to be that dire.

Keeping track of the details is what makes the difference when you're trying to rebuild. That's why it's wise to figure out now what a disaster plan should include, before you're in survival mode.

5 Steps to Take When An Employee Leaves

You're losing an employee. Whether the employee is leaving voluntarily or you're having to cut the employee loose, you're probably asking what the next steps are, and how you should protect yourself legally.

It's a tough situation to lose an employee. Don't complicate it further by making some bad legal mistakes.

Here are five steps you generally need to take after an employee leaves:

Starting a Business? 5 Legal Areas to Learn

You've decided to put your wonderful business idea into practice. Now you have to deal with the practical realities of starting a business, starting with all the legal requirements.

While you don't always need to hire an attorney to review your business' legal issues, you will at least need some basic understanding of the law -- and know where to find help if you get stuck.

Here are five legal subject areas that entrepreneurs will need to learn more about in order to properly start up a business:

At Work, Valentine's Day Romance Can Be Risky

Love is in the air with Valentine's Day around the corner, and there's no way to stop it. Even if your workplace rules forbid interoffice romance, you can bet that it still happens.

While you may have nothing against Cupid or the holiday of love, that doesn't mean it's always good for business. At best, an interoffice romance can make things a little awkward for a few weeks while the couple navigates their new relationship.

At worst, it can lead to a lawsuit against your company. Now's the time to check and make sure your policy will protect against the fallout of workplace romance, on Valentine's Day or any other day.

Here are some general tips:

Top 5 Tips for Pursuing Crowdfunding

Crowdfunding is the newest way to get a quick cash infusion, and potentially bring in more customers too. How can small business owners maximize its benefits?

It's not just a ploy for startups and small-time entrepreneurs who want to get a product to market. Thanks to the JOBS Act, crowdfunding can be used by any company to solicit donations or to find investors, a Forbes contributor writes.

This is all very new, and it can be hard to get a handle on which route to take. But if you keep these five tips in mind, you should be off to a good start:

Small Business Regs Rise Under Obama: Report

Small business regulations have gone up during President Obama's administration, a new report finds. What does that mean for small businesses, and why should business owners care?

On one hand, compliance with all the regulations can place a big burden on small businesses. On the other hand, many of the regulations are aimed at leveling the playing field for workers.

According to Forbes, some 854 new rules were approved in 2012. That's a 3.9% increase over 2011.

Beware Business Identity Theft During Tax Time

One problem that many business owners aren't aware of is tax identity theft. It can affect individuals and business entities alike.

Tax identity theft for businesses is a lot like identity theft when it comes to people, but instead involves a business' employer identification number, or other account information, being used for unauthorized purposes.

It can end up ruining your credit, disrupting your business, and costing a lot of time and money to clear up the mess.

Why a Patent May Be Vital to Your Business

Patents often make the news in battles between big companies. But what we don't hear about is how important it is for any business to get a patent.

Just because you aren't a Fortune 500 company doesn't mean you aren't coming up with new and interesting ideas -- like how to streamline your business. When those ideas spur a new invention, you may be eligible for a patent.

The first step is to learn more about patents, and there's a lot of free information online. Here's a quick look at why getting a patent may be vital for your business:

Another Strip Club Loses Fight Over 'Employees'

Are dancers at strip clubs employees or contractors? Kansas' highest court has ruled that exotic dangers at a certain strip club in Topeka were in fact employees and not independent contractors, ending a seven-year legal battle.

As a result, these strippers were entitled to certain employee benefits including unemployment benefits, reports The Kansas City Star.

So how do you know if your workers are properly classified as employees or contractors?

Top 5 FMLA Reminders for Employers

It's been 20 years since the Family and Medical Leave Act, more commonly known as the FMLA, was signed into law. What do employers need to remember about their FMLA responsibilities?

The groundbreaking law, signed by President Bill Clinton, serves to protect employees. Through its provisions, the Act places many responsibilities and duties on employers.

In brief, the FMLA allows eligible employees to take up to 12 weeks of unpaid leave for medical care, for the employee or for a family member. Some allowable reasons for leave under the FMLA include childbirth, adoption, or a serious medical illness.

5 Tips for Older 'Encore Entrepreneurs'

Are you an "encore entrepreneur"? Encore entrepreneurs are those who invest in ventures a bit later in life -- in general, anyone who turns to small business ownership after the age of 50.

It's not always easy to invest later in life. In fact, it's not even that conventional to get into small businesses when many are dreaming of retirement.

Luckily, there are many tips and tools out there for those looking to become entrepreneurs after 50. Here are five tips to get you started:

Can You Sue Customers Who Don't Tip?

A viral incident over a pastor's refusal to pay a tip at a restaurant raises a common question for those who offer services: Can you sue or take legal action against a customer who doesn't tip?

Customers like the pastor -- who wrote "I give God 10% -- why do you get 18?" on his receipt, according to Gawker -- may make you angry. After all, don't they realize how hard you work? And didn't they see the notice on your menu that says parties of eight or more will be charged a particular gratuity?

But anger and taking legal action are two separate things. Here's a look at your legal options for that miserly customer.

5 Tips for a Business Owner's Deposition

So you're being deposed. Perhaps your business is caught in litigation that you initiated, or maybe it's a legal fight that someone else is picking with you.

Whatever the reason for the deposition, you're now being called into a conference room with an attorney bombarding you with questions in front of a video camera.

It sounds scary enough. What do you do? Here are five things you need to know: