Law can be an overwhelming and ever changing element in business, which means it’s no surprise that many small businesses can end up making costly mistakes due to their lack of knowledge and reluctance to learn about the policies and procedures they should be following.
Whilst many companies manage the day-to-day running of business, the legalities can often fall behind.
Simply seen as another piece of paper or more boundaries to follow.
But as many companies have a legal team that’s on the ball every day, small businesses cannot afford such luxuries and instead it’s left as the sole responsibility of the business owner.
However just because you’re a small man band doesn’t mean the judge is going to sympathise with you when you slip up. We’ve listed the top five legal mistakes that businesses might not even know they’re making.
A Written Agreement
It seems pretty simple, but a written contract is one that can often be put to one side in the rush of employing new staff.
The exchanging of emails and a conversation is not a contract of employment and will not hold up in the court of law should any future issues arise.
A written contract should be signed by both the business and the employee as a mutual understanding of the job role and what’s expected.
Detailing every part of the role it should include working hours, payment, any holiday entitlement, and the procedures of the work place.
Not having a written contract is a breach of employment law, so make it easy upon yourself and your new employee by just writing it all down. If you’re unclear of what should be noted ensure to check with the HMRC for guidance.
Issues in the work place can start small but soon escalate into prolonged and potentially expensive problems.
For many small businesses dealing with grievances can be hard as it can often feel quite personal even if the problem is not with the business in the first place.
Rather than sweeping it under the carpet or playing blind to problems, business owners should ensure that they are dealt with as quickly as possible.
By law it is required that all businesses have a grievance procedure, and although it’s not a nice thing to have to do, it is essential for both the business and the employee.
Following on from problem solving, there are many procedures that are required in the work place to ensure that the business is adhering to the law.
All matters including redundancies, dismissals as well as health and safety, should all have their own documentation that you can present to the employee.
Nothing should ever be said or done without it being written down first.
It may seem that this is a paper heavy way of doing things, but this information can prove vital if any future issues occur.
Knowing Employment Rights
One of the trickiest and every changing laws within business is employment rights.
It can feel like a minefield and ultimately baffle any new businesses who are just taking on staff for the first time.
However, if there’s anything to always be sure on it has to be employment, as you are now taking on the responsibility of others within your business.
Ideally it is vital for small businesses to have a Lawyer or Solicitor to help with legal matters around employment. Not only for the fact that employment laws change constantly and they are trained regularly for this, but also for the on-hand knowledge and guidance they can offer.
Although there are many guides to employment law such as this one, having a dedicated lawyer to any of your business queries can be a peace of mind worth paying for.
Ignorance of the Law
As a small business there is no getting out of the fact that you need to follow the law as well as any other company. Bypassing them will only see you suffer financially and in worse cases see the business fail.
For example there have been many changes recently to flexible working hours, unfair dismissal and holiday entitlement. Do you know how this is going to affect your business?
It only takes a small amount of time to sit down and understand the guidance that has been set out, and if you’re really unsure there is help online through many resources.
The law is there as a safety blanket for us all, and utilising it well in business will see you thrive.