It’s that time of year again! Time to make personal resolutions to create good habits for the coming year. If you are a business owner, you should make similar commitments for your company.
These ten resolutions for business owners can assist a business of any size (from a start up to an established company) create positive corporate practices for 2015 and beyond. If you make and keep any of these resolutions, your business will be better off for it. So make this promise:
As a business owner, I resolve to …
- Form a corporate entity to limit liability and protect my personal assets. Doing business without a corporate structure leaves you (and your assets) completely exposed! It’s well worth the nominal expense to have peace of mind.
- Hire a business attorney to assist with and advise us on our business legal needs. Just like doctors, not all lawyers engage in the same practice areas. We have specific areas of expertise and experience. Choose a lawyer with the expertise you need to accomplish your goals.
- Have our contracts reviewed and updated by a business attorney to ensure we have the protection we need if something goes wrong. Don’t use contracts pulled from the Internet and try to act as your own attorney! Doing so could lead to dire, unintended consequences like costly litigation or a loss of rights.
- Maintain proper corporate governance to prevent losing our limited liability protection. Don’t just form it and forget it! There are actions you must take to maintain your limited liability. We can assist you by making sure proper corporate formalities, like annual minutes, are followed.
- Get a written agreement between the owners that spells out every partner’s rights, responsibilities and obligations. Business relationships, like personal ones, can sour over time. Having a well-drafted agreement that prepares for future contingencies can prevent costly, disruptive and time-consuming partner disputes.
- Make sure the company’s intellectual property belongs to the business and is protected. Many entrepreneurs never get around to protecting their company’s most valuable asset, the IP. Not having proper documentation can leave the IP outside the business and reduce the value of the company.
- Contact our insurance broker and review our coverage based on the current status of the business. With business booming, it may be time to increase your coverage. Not having enough coverage or the wrong coverage can be costly.
- Understand how the new LLC Act impacts our limited liability company and Operating Agreement. California adopted a law governing LLCs in 2014. You want to make sure your documents are in compliance. If you have an LLC but do not have an Operating Agreement, resolve to change that in 2015!
- Make sure our consultants and independent contractors (and interns, for that matter) are properly classified. Improperly classified workers can lead to costly fines and penalties. Consult with us to determine if your workers are properly classified.
- Make sure our company’s employee handbook, policies and agreements are up-to-date with current state and federal laws. The last thing you want is to discover that you’re not in compliance with California’s ever-changing Labor Code (e.g., new paid sick leave policy and written agreements for commission-based employees) or a new federal law. Consult with us to determine if your employment documents need to be updated.
If we can help you achieve your business resolutions, please do not hesitate to contact us. Wishing you a New Year filled with joy, good health and prosperity!
Toni Y. Long, Esq.