6 Legal Issues Small Business Should Know


Starting your own business is one of the most rewarding things. You get to be your own boss and call the shots, and you also get to be creative and innovative, working hard to make your business a success. It is critical for company owners like you to succeed in their business’ sales and day-to-day operations. But then, losing sight of potential litigations with your firm might quickly destroy your goals.

This is why business owners generally want to understand more about company law to ensure that they comply with it. Here are a couple of examples of such laws:

  • Finance Laws: Finance laws are the regulations and statutes that dictate how financial institutions and markets must operate. These laws cover various topics, from consumer protection to accounting standards to securities regulation.
  • Taxation Laws: Taxation laws are the rules and regulations governing how taxes are levied and collected. They cover everything from individual income taxes to corporate taxes to estate taxes.
  • Intellectual Property Laws: Intellectual property laws protect the creations of the mind, such as inventions, designs, and artistic works. These laws give creators the exclusive right to use their work for a certain period.
  • Employment Laws: Employment laws regulate the relationship between employers and employees. They cover minimum wage, overtime pay, discrimination, harassment, and workplace safety.

Knowing the laws before starting a small business might help you avoid future legal difficulties. However, knowing some rules will not guarantee your company’s survival; you must understand the typical legal issues these laws address.

Legal Issues You Should Know

From contract disputes to trademark infringement, here are six common legal issues that small businesses should be aware of:

Contract Disputes

Signing a contract is part of your life if you’re in business. These documents are legally binding, whether a lease agreement, supply contract, or employment contract. They can come back to bite you if not written correctly.

If you’re in a contract dispute, it’s vital to seek legal help as soon as possible. An experienced business attorney can review your contract and help you understand your rights and options.

Trademark Infringement

Your business name and logo are two of your most valuable assets. They help customers identify your products and services and set you apart from your competition. If someone uses your company’s name or logo without your consent, they infringe on your trademark. This might be a costly legal problem to fix, so taking action is needed.

For example, suppose you sell T-shirts with your business logo, and someone else starts selling T-shirts with a similar logo. In that case, you can send them a cease and desist letter. This is a formal demand to stop using your trademark without your permission. An experienced trademark attorney can help you stop the infringer and protect your valuable brand.

Employer is shaking the hand of his employer in front of a lawyer.

Employment Issues

These laws govern everything from hiring and firing to wages and hours. Violating these laws can result in costly penalties, so it’s important to make sure you’re complying with them.

The Fair Labor Standards Act (FLSA) requires employers to pay non-exempt employees overtime for all hours worked over 40 a week. If you’re an employer, it’s important to know which employees are exempt from this law and which are not. An experienced employment law attorney can assist you in comprehending all of this.

Another example is if your business is going bankrupt. Bankruptcy is a normal part of business, but you must know the legal implications of this decision with your employees. A trusted bankruptcy lawyer can help you understand your rights and options. This ensures you comply with the law without hurting your employees as you restructure your business.

Consumer Protection Issues

If you sell products or services to consumers, you’re subject to consumer protection laws. These laws are designed to protect consumers from unfair or deceptive business practices.

To illustrate, the Truth in Advertising Act prohibits businesses from making false or misleading claims about their products. You could be penalized if you violate this law, including fines and damages.

Tax planning and compliance

All businesses must pay taxes, and failure to do so can result in hefty penalties. It’s important to understand the tax laws that apply to your company and plan accordingly.

An experienced tax attorney can help you pay the right taxes. They will also help you take advantage of any deductions or credits you may be entitled to.

Environmental Regulations

If your business produces pollution or hazardous waste, you’re subject to environmental regulations. These laws are designed to protect the environment and public health. Violating these laws can result in hefty fines and even jail time.

For example, if you run a manufacturing company, you must comply with the Clean Air Act. This law limits the amount of pollution businesses can emit into the air. An experienced environmental law attorney can help you understand the regulations that apply to your business.


Small business owners can face many legal challenges and potential problems. Seeking help from an experienced attorney can make the process much smoother. They will make sure you’re navigating these challenges with ease while you can focus on what you do best – running your company.

About the Author

More to explorer

Scroll to Top