4 Common Legal Issues Impacting Small Businesses

Serving Harrisonburg, Staunton, Winchester and Nearby Areas of Virginia

Harrisonburg business law attorneysStarting a small business can be a challenging endeavor. There are many issues you’ll need to deal with during this process in order to get your business up and running. While factors such as hiring the right employees, developing your product or setting up the right business model may occupy most of your attention, it’s important to stay on top of the legal hurdles that can often bring down a small business.

It’s always a good idea to work with an experienced business law attorney when setting up your business in order to ensure that these important issues are addressed properly up front. Regardless of whether you seek legal help, it’s important to carefully address the following 4 legal issues to prevent costly lawsuits and other problems down the road that can potentially sink your business.

  1. Choosing the proper legal structure for your business

    Selecting the right legal structure for your business is one of the most important decisions you’ll make as a business owner. The legal structure you choose can impact the amount of money you’re required to pay in taxes, the extent of your personal liability in the event of a lawsuit, and many other important matters.

    There are several different options to choose from, including sole proprietorships, partnerships, LLCs, S corporations, and C corporations. The experienced business law attorneys at Hoover Penrod can explain the benefits and drawbacks of each option and help you determine the right structure for your business based on your unique needs.
     

  2. Navigating intellectual property and copyright laws

    It’s important to protect your intellectual property so that it’s not stolen by competitors. You can do this by patenting technology used in your product, trademarking your business name and logo, and copyrighting the use of certain phrases which may be crucial to your branding.

    Similarly, you must be aware of the patents and trademarks already existing for the technology you are using and marketing. If you infringe on a patent or trademark previously established by a competitor, you may face a lawsuit that can potentially ruin your business.

    The attorneys at Hoover Penrod can help you research existing patents and trademarks to ensure your business won’t face a patent lawsuit down the road. We can also help you navigate the process of patenting and trademarking your own intellectual property so that other companies can’t steal it from you.
     

  3. Employee law issues

    There are certain issues you’ll need to be aware of when hiring employees for your small business. These include:
     

    1. Correctly determining whether someone is considered an employee or an independent contractor – this distinction impacts whether you need to adhere to minimum wage and overtime laws for an employee, and it also affects whether you must withhold income, Social Security and Medicare taxes for this employee.
       
    2. Knowing whether an employee is covered under the overtime laws set forth by the federal Fair Labor Standards Act (FLSA) or is considered exempt from these laws – failure to correctly follow these laws can potentially make you vulnerable to a costly wage and hours lawsuit down the road.
       
    3. Establishing clear and fair human resource policies at your company and hiring a human resources professional to ensure these policies are properly enforced – failure to address this issue can potentially make you vulnerable to harassment and discrimination lawsuits, as well as other employment litigation from disgruntled employees.
       
    4. Carefully documenting the reasons for firing a poorly performing employee in order to avoid a potential wrongful termination lawsuit.
       
    5. Having your employees sign nondisclosure and non-compete agreements, when appropriate, in order to safeguard business information that you want to keep secret and to prevent employees from taking your ideas and secrets to a competitor or from stealing clients after leaving your company.
       
  4. Adhering to business tax laws

    Your business will be subject to certain tax laws based on the legal structure you choose. These tax laws can be very complicated, and it’s important to work with an experienced business accountant or a business law attorney who can help ensure you file your taxes properly and keep all necessary records for documentation in the event of an audit. At Hoover Penrod, we can help you navigate these complex tax laws to ensure you are doing everything properly.

These are just a few of the legal hurdles you may face as a small business owner. There are many other issues that can arise and potentially impact the success of your business. The business law attorneys at Hoover Penrod can provide you with the guidance and legal assistance necessary to ensure you handle all of these issues properly as they arise.

Please contact Hoover Penrod using the form on this page or call 540-406-4060 today to schedule a consultation. We serve clients in Harrisonburg, Staunton, Winchester and the surrounding areas of Virginia.