What Is Your Business Going to Do Better In 2019?
We’re now half way through January, and however your personal New Year’s Resolutions are going, here are some things that we recommend every business should do for a smoother 2019.
We see the same legal problems arise from time and time again, which we believe could be resolved if local businesses took some basic precautions.
It never ceases to amaze me how very many businesses don’t have the right legal documents in place to protect their owners and directors – despite the fact that most of these are relatively simple and inexpensive. Regardless of whether you’re a fresh start up, or an established and successful business, do you have the essential protection of the right legal and business documentation – because these aren’t just desirable, they are essential;
Your Business – Our Top 10 Tips For Your New Year Resolutions
In general, ‘Be prepared’ is the best legal advice. Know your position and anticipate problems. It is much cheaper to have good contracts prepared and to take advice before problems arise. Waiting for litigation to occur simply leads to much larger legal bills.
Here are our suggestions for legal New Year’s Resolutions for 2019.
1. Employment contracts – Ensure that all of your employees have up to date employment contracts, and ideally get a staff handbook.
2. Shareholders’ agreement or partnership agreement – If you run a company or partnership, make sure that you have a written shareholders’ agreement or partnership agreement. You may think that you will get on with your colleagues forever, but in practice people do fall out, fall ill or even die. Covering yourself and your family with proper documentation in advance makes sense and removes some of the risks:
•Your Partnership Agreement. If you’re in business with someone else, and if you haven’t formed a company, then regardless, or not of whether you have written a partnership agreement – you’re in a partnership. Don’t leave it to chance – in the absence of a written agreement, your business is governed by the 1890 Partnership Act. Take control of your own business – get a properly drafted written partnership agreement that accurately reflects your wishes.
• Your Shareholders Agreement – you are not legally required to have a shareholders agreement – but they can be incredibly useful. Without them, you can find your company hamstrung by someone else’s idea of how to run your business. It’s particularly important when it comes to setting out arrangements for any dispute or buyout. It’s a kind of thing that people put off – but any sensible business owner will make sure they get their company rules sorted out from the outset. Again, it’s a simple document – and incredibly cheap when compared with the often catastrophic cost of shareholder bust ups.
3. An up to date will – Everyone should have a will – especially business owners. Getting a will written by a solicitor is easy and can cost as little as £150 – a small price to pay for peace of mind and the possibility of minimising tax.
It’s really not good enough just to have your will drafted once and for all. The chances are that, as your personal life and business mature, your circumstances will change. What might been perfectly appropriate for a 25-year-old single person running a start-up, is unlikely to be appropriate for a 55-year-old MD of a large business who is on his second marriage with children from both relationships.
Just as you review your pension and financial planning regularly, and just as you get a medical check-up and your eyes tested – you should look at your will to see if it adequately covers your circumstances. What happens to your business if you die? Does your will maximise tax savings? Does your will prevent potentially expensive claims on your estate – claims against your business
Click here to read more about making or updating your Will
4. A Lasting Power of Attorney – how will your business operate if you become incapacitated? Without an LPA in place, giving someone the legal authority to run your business and authorise expenditure, you could find that your business will have gone belly up by the time the Court appoints someone to run it on your behalf
An LPA is the simple answer – a legal document giving someone the legal authority to take over the day-to-day management of your business if you become physically or mentally unable to do that yourself. In short, without a LPA, your business is at risk of chaos.
Click here to read more about getting your Lasting Power of Attorney
5. Written terms and conditions – you do have simple, clear and up-to-date T&Cs, don’t you? If not, this could be the simplest, quickest and cheapest way to tighten up your cash flow – it really is a no-brainer.
Make sure that your terms and conditions are both simple and clearEnsure that you have written terms and conditions of sale and purchase and that these are sent out for all enquiries and orders. This simple step improves your legal position enormously if a problem occurs subsequently such as defective goods, late delivery or the customer going out of business.
Click here to find out more about making sure you have the right written Terms and Conditions
6. Tighten your credit control policy – make sure that you have a tight credit control policy, that everyone knows about it and that it is used. In the current economic climate, good credit control can mean the difference between a business thriving and going under.
7. Legal health check – have a legal health check or audit. Update your written contracts, look at areas where you are legally exposed, from employment law to intellectual property and health and safety.
8. Put in place an email/internet policy. Staff wasting time on the internet at work costs British business millions of pounds. A simple and enforceable policy not only should improve productivity by cutting staff time wasted on unnecessary personal internet use but you may also find you are unable to discipline staff if you find them acting inappropriately unless you have good policies in place setting out your rules very clearly.
9. Review your complaints policy – Look at how you handle disputes in your own organisation. Do you have a complaint policy and is it up-to-date? Do members of staff know where and when to go to get legal advice? How is something that may become a major legal dispute notified to senior management in your business?
10. Review use of your lawyers, if you have them. Are they cost effective? Do they respond quickly? Do they give clear and practical legal advice? Why not check out your own lawyers on the internet – the web says so much about a business.
Don’t put off tomorrow what you can do today
That’s what my grandma said – and she was right. Call our specialist business law solicitors or email us using the contact form below and find out how to protect your business properly.
Worried about a legal problem? There’s no need – call us today for free initial phone advice and let us put your mind at rest.
- Call us on (01722) 422300, or FREEPHONE 0800 1404544 OR
- Complete the email enquiry form below.