3 Small Business Legal Mistakes To Avoid

If you are just starting your own small business or thinking about starting your own, you may think you have everything taken care of, but there are many small mistakes you can make that will devastate your business. If you want to protect your investment, check out these three small business legal mistakes to avoid:

Picking the Wrong Structure

If you're a small business, you may not understand the importance of choosing the right business structure. These include sole proprietorship, LLC, corporation, and others. You need to fully understand the pros and cons of each. For example, if your business is extremely small, you may not consider the potential damage if someone decides to sue you. If you are a sole proprietorship, you will be held responsible for those lawsuits. However, if you simply had registered your business as an LLC, the business and not you would be responsible.

Failing to Provide a Privacy Policy

A privacy policy is simply a policy that the business follows to ensure customer personal information is kept private. Whether you have an online or physical business, if your business markets its services or products, you are required by law to have a privacy policy in place, and you must follow that policy. Another benefit to having a privacy policy in place is that it gives customers a feeling of trust, so they are more likely to return. Your business attorney will be able to help you craft a legal policy.

Not Having an HR Guide

Small businesses often forget to create a human resources guide. For example, you may start a business with just you and your spouse, but when you hire a new employee, you forget to create an HR guide. That employee begins to dress or act inappropriately. Without an HR guide, you don't have any ammo to enforce proper behavior. If you do decide to fire that employee because of their behavior, they may come back to sue you, and if you don't have an HR guide that backs up your decision, you could lose. The HR guide should include everything on how employees need to behave.

Avoiding these small mistakes is easy, and it is important to protect your company. Don't let your small business fall victim to a small mistake. For more information regarding business law and other pitfalls, you must avoid, contact a corporate attorney in your area today and schedule a consultation.