Torfaen Business Voice August 2017 Newsletter

Legal issues
for businesses
This article aims to explore some of the legal issues that
businesses face. Many small businesses start trading without
really considering the issues that ought to be addressed. Often
they will take a Tenancy or a Lease to a premises without
taking legal advice and employ staff (sometimes starting on a
part time basis) without realising the responsibilities that come
with that decision. The success of a new business often
depends upon the planning stage which takes place before the
business considers opening its doors to the public or providing
a service and a lack of planning can lead to business failure.
Here are a few of the
issues to be considered:
1. Regulatory issues
You need to consider whether the type of business that you are
operating requires some sort of permission from the Local
Authority or from a Regulatory body before you can open your
doors. As an example, if you are thinking of opening a café or
a takeaway you would need to consider whether the necessary
planning permissions are in place for the premises you want to
use. If you are intending to make a product you need to establish
whether there are minimum safety standards that apply. It
is often worth contacting your Local Authority, a trade body or a
specialist business lawyer to establish what sort of advice you
require.
2. Naming your business
The name of your business is very important and quite often a
lot of time is spent thinking of snappy names that will stick in
the memory. However, many new businesses don’t check if
they are able to purchase the website domain name to correspond
with their name or fail to conduct searches to check that
their name won’t cause offence to an existing business that
trades under the same or similar name. This often leads to a
Cease and Desist letter from a set of expensive London
lawyers. In a recent case a local convenience store named
itself Singhsburies and was challenged by the global supermarket
over that. It may well be that the owner has a strong
sense of humour as he has now changed it to Morrisinghs but
on a serious note if you have spent a lot of money on signage
and marketing for your business you don’t want to be in a
position 6 months down the line where you have to change the
name to avoid legal action. It is worth taking advice from an
intellectual property specialist as it shouldn’t cost an awful lot of
money and could save you potential difficulties in the future.
JANUARY
3. Employing staff
Many small businesses take on friends or family as staff and
Business don’t give a finance lot of thought to the implications of having
MAY employees. - JUNE It is important you speak to an employment
lawyer prior to taking on staff, as all staff have the right to a
JULY written set - AUGUST of Terms and Conditions and there are minimum
standards in relation to rates of pay, payment of pension and
SEPTEMBER
other rights which you need to adhere to. It is worthwhile
meeting with an employment lawyer to discuss the best way
to employ your staff as there are various options ranging from
Manufacturing
having agency staff, self employed contractors, full time staff
or casual staff. There are different implications for each type
of worker or employee and whilst the employment legislation
is incredibly complex a specialist in the area ought to be able
to see the wood for the trees fairly easily. Failure to comply
with the rules can lead to serious consequences including in
some cases criminal liability for failing to pay the national
OCTOBER
minimum wage.
4. Obtaining your premises
Whether you are entering into a short term business tenancy
or a longer lease it is always worth obtaining advice. Leases
are always complicated documents and can often contain
clauses which whilst appearing innocuous at the start cause
difficulties later on. Also, an experienced commercial property
lawyer will be able to advise you about the incentives that a
landlord may offer you if you want to improve the premises. It
is important to protect yourself if you intend to spend a lot of
money customising a business premises and advice is
essential.
5. Structure of your business
There are a number of choices that you can make about how
your business is structured. You could be a sole trader, a
partnership or a limited liability company amongst a myriad of
other options. An experienced business lawyer will be able to
advise you which trading vehicle best serves your needs.
Whilst being a sole trader may be the simplest option, it also
carries with it unlimited liability which you may wish to avoid. It
is relatively easy to set up a new company with the assistance
of a business lawyer and an accountant and many new
businesses are surprised at how cost effective that advice can
be. There are various government funded organisations which
provide free advice for new businesses and you should make
sure you take that opportunity and always remember if you
don’t ask you don’t get.
Finally, whilst you may be excellent at producing the product
you sell or the service you offer, most successful people
concentrate on what they do best and use the expertise of
others to make sure that the legal framework of their business
is correct. Legal work is a little like dentistry, you can do it
yourself but it is likely to be painful if you do.
TORFAEN BUSINESS VOICE | AUGUST 2017 NEWSLETTER 3