Alkalay & Smillie, PLLC

Articles of Interest

Attorney Edward Alkalay writes a regular column for the Conway Daily Sun newspaper entitled "The Legal Corner." His articles address a wide variety of timely legal issues. Click on the titles below to review his past articles.
 

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The Legal Corner: The Legal Corner: Legal tips for businesses, part II

In my last article, I addressed issues that businesses should review at the beginning of each year. In this article, I will address other typical legal issues that business owners should be aware of and address as needed. Businesses are often vulnerable to a variety of legal issues because the owner’s time is usually spent marketing and running the business, with little time left over for considering potential legal issues. Spending just a little time reviewing potential legal issues can prevent needless stress and save a lot of money.
Nonpaying customers: Too often I have seen businesses moving merchandise rapidly but not staying on top of the receivables. This often happens in the construction field. If you have sold goods and services and do not get paid promptly, your cash flow will suffer and you will end up with collection problems. This will lead to the need for a lawyer\'s letter to the customer or to take a nonpayer to court. In most cases, you will not recover the full amount owed to you and you will spend time and money on collections. There are several ways to avoid this. First, get advance payment where possible. If you are in a business where this is not possible, allow customers to pay with credit cards or cash directly after the work is done. If you must sell on credit, verify that your customers are creditworthy when large sums are at stake. Finally, if you must pursue collections, adopt an efficient and cost-effective collection practice, which includes immediate contact once payment is delinquent.
Insurance Issues: If you are over insured, you could be paying too much. If your business is underinsured, you could be jeopardizing your future. You need to make sure you review your property insurance and liability insurance.  Review your insurance needs at least once a year to ensure that you have proper coverage.
Personal injury actions: Slip-and-fall cases and other personal injury actions are often brought against small businesses because claimants often believe that even if claims are not viable, these companies will settle rather than fight. Unfortunately, all too often these claimants are right. What you should do to avoid this problem is to make your premises as safe as you can. Conduct a safety review to look for possible trip hazards, such as torn carpeting or exposed wires in areas visited by the public, and review other potential safety hazards. Rectifying these problems in advance can save many thousands of dollars.
Internet Policy and Security: If you provide employees with computers and work emails, be sure to have an explicit email internet policy. This policy should state what employees can and cannot do on a computer. For example, you may allow brief personal email exchanges with family or friends, but disallow more extended personal use. It is up to you. However, your policy should be well thought out and communicated to all employees in writing.
Employee workplace issues: Along the same lines, you should have a written policy for potential employee issues including sexual harassment, discrimination (based on age, gender, race, or national origin), and wrongful termination. Make your company’s policy very clear to staff and issue your policy to employees in writing. I have advised many employers regarding these policy issues and have drafted many policies designed to protect employers in the event that these issues should arise. At best, these policies can prevent problems from occurring and, at worst, provide a defense should these issues ever go to court.
Contract disputes: You should have clear written agreements among co-owners (e.g., buy-sell agreements), and with vendors and suppliers, and often with customers. A contract does not have to be a lengthy with a bunch of “legalese.” But it should be clearly written so that all parties understand their obligations. Most contract disputes arise because either there is not written contract or one or both parties do not understand the contract because it is confusing or ambiguous as to the parties’ obligations.
While there are other legal issues which affect businesses, the most important concept to take away from this article is to try and prevent problems before they arise. The saying “an ounce of prevention is worth a pound of cure” applies to businesses just as it applies to health. A conscientious review of policies and procedures before there is a problem can save a business substantial aggravation and money.

Edward D. Alkalay is a partner at Alkalay & Smillie PLLC and can be reached at (603)447-8994 or ed@northconwaylawyers.com. (This article conveys general information and should not be relied on for legal advice without further research and/or consultation with an attorney.)

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