Most Common Legal Mistakes Businesses Make
Running a business is hard work. Besides dealing with marketing, staff, product development, and various business processes, many companies also have to deal with multiple legal issues. If you’re facing corporate and business law issues, you must contact an experienced lawyer.
With all that said, let’s look at some of the most common legal mistakes businesses make. Keep in mind, however, that this list is not exhaustive. No matter the specifics, if you are from Mississauga and need business legal advice or services, it’s smart to talk with a lawyer at Gujral Law Professional Corporation.
Not Considering Which Company Structure to Use
Starting a new business is exciting, and it’s tempting to focus on moving products and services. That said, it’s vital to consider what type of business structure will work best for you, your efforts, and your company.
Some of the most common structures include:
- Sole proprietorship- A single owner who is typically liable for the business.
- Partnership- Multiple people who privately own a company.
- Corporation- A legal entity that is separate from its owners.
- Branch operations- An extension of the business’s operations into Canada. The branch is part of the parent company.
- Subsidiary- Similar to a branch operation, but the organization in question is a separate legal entity from the parent business.
Using Poorly Written and Defined Employee Contracts
If you’re hiring staff, you’ll want to ensure that you have employees sign a contract that will safeguard both parties’ interests. Poorly written contracts could cost you dearly in the long run.
Signing Subpar Business-to-Business Contracts
If you’re going to engage another company, you’ll want to ensure that a well-written contract is in place. Otherwise, you expose yourself to increased liabilities. With B2B contracts, it’s important for all parties to understand their obligations. If someone ends up in breach of the contract, the contract itself will provide protection and recourse.
Failures to Meet Laws and Regulations
Companies must follow a variety of laws and regulations, otherwise, they could end up facing civil and even criminal action. Navigating laws and regulations is complex, but a business lawyer can help. A lawyer can also provide business legal advice for preventing issues in the first place.Back to Business Law Page