Free Enterprise - The FindLaw Small Business Law Blog

June 2015 Archives

Do you drink Beck's beer? If you do, you may be entitled to a refund.

A couple years ago, Francisco Rene Marty, Seth Goldman, and Fernando Marquet, all avid Beck's drinkers, sued Anheuser-Busch, the company that makes Beck's Beer for misleading marketing claims regarding the beer's origins . Finally, the case has settled, and deceived customers may soon be able to claim a refund.

While same-sex couples can now legally marry in every state, LGBT people still face discrimination in many other areas of life.

LGBT people face employment discrimination everyday, but it doesn't have to be that way. Here are five tips to prevent LGBT employment discrimination and avoid lawsuits:

Many politicians have strong feelings about undocumented immigrants coming to the United States. However, Donald Trump took things too far, and now it's backfiring on him.

Mexican language television company Univision announced that it has cut all ties with Donald Trump and his organization after Trump made seemingly racist comments against Mexico and Mexican people.

Do you have a small business lawyer? If no, why not?

When there are countless rules, regulations, and laws governing the operations of a business, small business owners can't afford to ignore the legal aspects of running a business. Go find a small business attorney and ask him or her these three legal questions asap:

I'm sure there are a million things you'd like to do to a shoplifter in your store. That's your merchandise (and hard earned revenue) walking out the door.

But you don't want to get in trouble yourself, right? So what are your legal rights when dealing with shoplifters?

Obama Plans to Expand Overtime Pay

How many hours a week do your employees work? 40? 50? 60? Do they get overtime pay?

Most salaried workers do not get overtime pay, but President Obama may be looking to fix that. Since last year, the President ordered the Labor Department to implement new rules to expand overtime pay for millions of workers.

Reports speculate that the Labor Department will announce its new proposed rule soon.

Regardless of your personal feelings about #hashtag activism and personal shaming on social media, the fact remains that an employee's personal tweets can have a negative impact on your business. Look no further than Regal Movies employee Hyley DiBona's racist tweets following the Charleston shooting, and the subsequent boycott of the theater chain until DiBona was fired.

Yes, they were just tweets, and yes it was her personal, in-no-way-related-to-work account. But her online comments undoubtedly had a negative effect on Regal, and the company fired her quickly and publicly. 

Did they make the right decision? How should your small business respond if an employee publishes offensive personal tweets?

All small businesses have different expansion patterns. Most grow in fits and starts rather than following one smooth upward curve of success. As a result, figuring out specific benchmarks for your small business can be difficult.

One key benchmark is the moment you hire your own in-house counsel. How big does your company need to be before it makes sense to have full-time legal counsel? While there is no perfect formula to figure this out, here are a few considerations:

Last year, California passed the Healthy Workplaces, Healthy Families Act of 2014 (AB 1522). The act is also known as the Paid Sick Leave law.

The law requires employers to give qualified employees paid sick leave. While the law took effect on January 1, 2015, the accrual period starts July 1, 2015.

Here is what you need to know:

What may be legal in the United States can get you arrested in another country.

Toyota and its new head of global public relations, Julie Hamp, are learning that lesson the hard way. A U.S. citizen, Hamp was arrested recently on suspicion of illegally importing a drug into Japan.

While many people would expect California to lead the way on legalized marijuana, the state is a mess of overlapping and sometimes contradictory legislation that can vary from county to county or even city to city. When Lieutenant Governor Gavin Newsom announced his campaign for the governor spot in February, he called the Golden State "the worst of all worlds" when it came to regulating the pot industry.

So it's only natural you'd have a California mayor taking bribes to protect some medical marijuana dispensaries while ordering police raids on others. Also, it's only natural for the officers conducting those raids to partake in a few edibles while they're at it. Wait, what?

Where did you attend school? How many jobs have you had? Have you ever been convicted of a crime?

Advocates of the "Ban the Box" movement are working to remove that last question from job applications. As a small business owner and employer, how could this affect you?

Last night marked the beginning of Ramadan, Islam's holy month of fasting, and employers may have to make some reasonable accommodations for Muslim employees.

Here's how to be a good boss where employment law and religious law intersect.

Beware of the eight-legged chicken!

Don't worry. They don't exist. At least, that's what KFC wants to remind us. The fried chicken company has long been plagued with rumors of mutant chickens in China. But now, the company has finally had enough. It's turning to the courts to squash the rumors.

Have you ever wanted to open a shop to sell the t-shirts you designed or all the paint-by-numbers you created? If you're worried about committing to a yearlong business, you may want to consider starting a pop-up shop. 

Pop-up shops are gaining in popularity as they allow business owners the flexibility of connecting with customers without committing to a year-round business.

If you're planning on starting a pop-up shop, here are five legal requirements to consider:

Unpaid internships can be a boon for small businesses: you can train a whole new generations of employees and get a test run before committing to a full hire. But they can be a legal minefield as well.

Warner Music just had to pay $4.2 million to settle a lawsuit for underpaying interns, while Conde Nast, NBC, and Gawker Media were also targeted by former interns. (Not even law firms are immune from the summer intern lawsuit.) So what did these companies do wrong, and what do you need to do right to make sure you don't get sued by your interns?

According to the Dodd-Frank Act, "No employer may discharge, demote, suspend, threaten, harass, directly or indirectly, or in any other manner discriminate against, a whistleblower in the terms and conditions of employment."

So, while you may be angry enough to fire the guy that turned you in to the SEC, don't. You could be setting yourself and your business up for even more legal troubles and monetary sanctions.

Here are some do's and don'ts to help you avoid a whistleblower retaliation claim:

Colt Defense, LLC, one of America's oldest and most storied companies, filed for bankruptcy this week. It seems impossible that such a historic brand (and a gun manufacturer in America at that) could go bankrupt, but bidders weren't exactly chomping at the bit for the company when it went up for auction.

If it can happen to Colt, it could happen to you. So what can small business owners learn from the legendary gun maker's mistakes? Here are 3 lessons:

We all make mistakes. And when small business owners make a mistake on a hire, it could be costly.

A bad hire could have a negative impact on your company's morale and its bottom line. So dealing with a bad hire (and doing it legally) can save you time, energy, and money.

As a small business owner, you probably have a lot of people working for you. Is one of them a small business attorney?

If no, why not? A small business lawyer can take care of all the legal requirements of owning a business, defend your business from employee harassment and discrimination claims, facilitate business deals, and draft favorable contracts. Do you have the expertise to do that yourself?

If you don't have a small business attorney, hire one. Don't worry it can be pretty simple. Here's a checklist for hiring a small business attorney:

It happened to Target. It happened to Home Depot. It just happened to the federal government. Can it happen to your small business?

We're talking about hackers and data breaches. While most data breaches covered in the news affect large companies with millions of customers, your small business is just as vulnerable. According to Internet security firm Symantec, 60 percent of cyber-attacks in 2014 targeted small and midsize businesses.

With two thirds of adults refusing to return to a business where their personal information was stolen, can your small business afford a data breach?

Everyone's suing everyone these days and everyone's buying insurance policies to cover the costs of litigation. Well almost everyone. It turns out there was one market underserved by the legal insurance industry, but those days may be over.

One insurance brokerage based in Los Angeles has begun selling insurance policies that cover franchise chains facing litigation, and the company's owner thinks this previously untapped market is "going to be a gold mine." This revelation may have franchise owners wondering if they need litigation insurance.

Is This Accommodation Reasonable?

Do any of your employees have a disability and need accommodations to do their work?

Title I of the Americans with Disabilities Acts requires employers provide qualified employees with disabilities with reasonable accommodations to remove workplace barriers.

However, employers may want to know when is an accommodation reasonable, and when does it become unreasonable?

If your employees are healthier, they'll miss work less, and you'll pay less money for their medical care.

So, it would make economic sense to encourage employees to be healthier right? Many employers have introduced wellness programs that offer incentives such as discounts for employees that meet certain health goals. Do you offer such a program? Here are three legal concerns of wellness programs that you should watch out for:

As if the Israeli-Palestinian conflict could get any murkier, now American states are battling with American companies over the issue. South Carolina became the latest state to pass a law allowing the state to boycott businesses that boycott Israel.

Reminiscent of the famous California-Arizona Boycott Wars of 2010, South Carolina's new legislation goes well beyond a similar law passed in Illinois last month. How far? Let's take a look.

Chipotle is following in Starbucks' footsteps and offering more benefits to all of its employees.

Chipotle has prided itself on its "people culture." To further the aims of that culture, the chain will now offer all employees full tuition reimbursement, sick pay, and paid vacation time. These benefits were previously only for salaried employees, but, starting July 1, all hourly and entry level employees will also receive these benefits.

Chipotle is not alone in its push to take better care of its employees. Entrepreneur reports that Starbucks expanded its tuition reimbursement program to cover four years of education, and McDonalds has similarly extended its education program and vacation policy. As a small business, should you take a leaf from these companies' playbook and expand your employee benefits too?

Do you pay your employees under the table?

We get it. It’s simpler for you to just hand over cash once a week. You won’t have to bother with record keeping, deducting taxes, reporting income. You even think you’re doing your employee a favor because she gets to keep her whole paycheck.

But, if you’re found out, the penalties and punishments for unreported employment (also known as under the table employment) may cost you more money and hassle than if you had done everything by the book.

So, how much trouble are under the table employees?

It used to be that a business was flying into an IPO blind: you couldn't talk to potential investors until after you filed all of your public offering documents with the SEC. So hundreds of thousands of dollars could be wasted before a company could gauge if there was sufficient interest in their stock on the public market.

Companies were forced to circumvent these requirements through "educational meetings" between investment bankers and large investors, but it appears that those days are done. Companies can now legally "test the waters" before they pursue a mini-IPO. Here's what you need to know about new legislation that regulates the pre-IPO process:

Businesses complain about it all the time: having to defend themselves against patent trolls and frivolous litigation. But many business owners are still in the dark about what exactly a patent troll is, how they operate, and why small businesses should be worried about them.

Patent trolls don't only go after giant corporations like Apple and White Castle. They can also stop a startup in its tracks. So here is how patent trolls work and how you can protect your small business.

How Do I Sell My Business?

So, you've spent the last 20 years building up your business. Now, it's time to leave the corporate world behind for a beach in Tahiti. Or a condo in Oshkosh. Whatever.

Is it time to sell your business? Here are some tips for selling your business for the best value:

How do you schedule your employees? Do they have set hours? Do they have on-call shifts that can be cancelled as late as one hour before a shift started?

A California lawsuit against Victoria's Secret and an Attorney General's investigation in New York may change the practice of unpaid on-call shifts.

Caitlyn Jenner's appearance on the cover of Vanity Fair is the latest and possibly brightest light to shine on transgender issues in America. And while most of us won't have the fun of hiring Caitlyn herself, we may have transgender people on our staff soon, if not we don't already.

So what are the issues that transgender employees face? And how can employers be best prepared to handle any legal issues that might arise from having transgender employees?

In a near-unanimous decision, the Supreme Court found that Abercrombie's decision not to hire a Muslim woman based on her decision to wear a headscarf could constitute religious discrimination. Justice Anton Scalia, who called the decision "really easy," wrote: "An employer may not make an applicant's religious practice, confirmed or otherwise, a factor in employment decisions."

While Samantha Elauf's case has to go back to the lower courts for a final ruling, there is plenty to glean from the Supreme Court's ruling. Here's what employers should keep in mind:

Summer is almost here! While a vacation is definitely recommended, don't spend the whole summer relaxing.

Here are five things your small business should definitely do this summer:

A defective or dangerous product is a business's worst nightmare. The damaged reputation and possible civil suits are bad enough to contemplate, but do small business owners need to be worried about jail time as well?

When companies contemplate a product recall, it's often a consideration of the potential harm and potential civil liability. But there are scenarios in which failing to recall a product could result in criminal charges, as well.

Big businesses, like Walmart and Apple, seem to just roll along on the momentum of their success and power.

However, small businesses don't have that luxury. You fight for every little success and every advantage to get ahead of the competition. Some small businesses are so small, most people have never heard of them before.

For example, have you heard of a pet mediator?