There are plenty of times when an entrepreneur needs a lawyer to consult with. Establishing your startup as a bonafide business, with all the legal trimmings, is just one instance. Creating a business requires legal work. Most entrepreneurs know that. This is not one of those Startup Law 101 bits of advice. Weâ€™re talking about all those other things entrepreneurs typically run into as they grow their business. They are most likely not aware of some of the errors in judgment they are making, that is until something happens. Even if you have an attorney of record who is supposed to be looking out for you, what does a startup need legal advice for?
The consequences of not trusting a lawyer with important aspects of your business cannot be overstated. Lawsuits and legal judgments can cost the entire company in some cases. How to avoid the pain of this scenario?
Does A Startup Need Legal Advice To Start Hiring People?
If you have gotten to the stage where you are ready to start hiring people and paying them a salary to work for you, then congratulations! It is an exciting time to go from not only having the title of entrepreneur but also an employer. It seems simple; place job ads, interview people, make a hire and live happily ever after with new employees. Sounds great, right? Too bad it doesnâ€™t always work out that way.
Laws on dealing with employer/employee relationships (particularly ending them) vary from state to state. Also, whether or not itâ€™s worth contesting an unemployment claim is something entrepreneurs can find themselves up to their necks in legal drama pretty quickly. The worst time to call a lawyer is when you have already made a mess of things, trying to mitigate legal issues with a former employee yourself.
Before you decide to start hiring, consult with an employment lawyer about what you need to know to hire legally and what to do when you need to terminate employment in your state.
Certain forms need to be filled out before hiring someone, especially tax forms and proof of citizenship. Not following the law regarding employment because you didnâ€™t educate yourself is not a defense in court. Get familiar or pay the price later.
Does A Startup Need Legal Advice On Paying Taxes?
The short answer to the legal advice on taxes question is, â€śYes!â€ť Having an accountant is one thing but they are not experts in tax law either. You can get yourself in a lot of trouble if you do not know what you are responsible for paying as a startup business. You also have to know what the legalities are regarding moving money in and out of your business account, depending on your corporation filings. There are differences in the law regarding money and income as an entrepreneur when it comes to what kind of corporation you filed your business under. Know now before you are audited and itâ€™s too late to avoid fines and penalties.
Speaking of taxes, you are responsible for paying all of your payroll taxes properly and on time. Unless you hire a payroll processing company to do it for you, you will still need to make sure you do it correctly and in a timely fashion. Overlooking or just plain procrastinating on paying payroll taxes is a big mistake for startups.
Does My Startup Need Legal Advice When Someone Gets Hurt On The Job?
What you say and do when your employee gets hurt on the job makes a big difference when it comes to workersâ€™ compensation claims. You can do a lot wrong when you try and make an accident on the job go away without filing a workersâ€™ compensation claim. Whatâ€™s worse is when you donâ€™t have workers’ compensation insurance at all. Before you hire anyone, make sure you are covered for when accidents happen at work.
Even if your office workers are going to be sitting in a cube all day, you still need workersâ€™ compensation insurance. Make sure you are covered or youâ€™ll just end up in court paying a whole lot more than the workersâ€™ compensation insurance premiums in the end. Avoiding the expense of workersâ€™ compensation insurance is very expensive.
How Can I Avoid All These Legal Pitfalls Without A Team Of Attorneys On Retainer?
The good news is you can avoid most of these legal ills by doing one thing; working with a PEO. PEOs help startups avoid a lot of the legal drama they find themselves in by providing the following services:
- All Federal and State Employment Law Compliance
- Payroll Processing And Payroll Tax Management
- Workersâ€™ Compensation Insurance
- Risk and Safety Training
For advice on which PEO to work with, look no further and a PEO broker like PEO Spectrum. You donâ€™t want to trust legal advice to just anyone, right? Donâ€™t trust just Internet searches and 3rd hand information for advice on PEO services either. Youâ€™ve come along way in your business to just end up losing it all in employment litigation. Trust a PEO to help you make the most of hiring employees and get back to focusing on building your own personal empire.