In a survey conducted in 2010 by the US Chamber of Commerce, small businesses paid approximately $105.4 billion in lawsuits. Chances of a small business running into a lawsuit are high as they interact with workers, other businesses and also cases of bankruptcy. While many businesses are not prepared for lawsuits, there is a need for your business to know how and when to avoid expensive lawsuits.
No business wants to be sued. It costs money, time, and can be the end of some small businesses. Here’s how to completely avoid business lawsuits. We give you everything you need to know to avoid getting sued.
1. Hire an Attorney
This is not normally the first step for many small businesses as they wait until they are sued for them to hire a lawyer. When you consult your lawyer when a business starts, they can guide you to know on things to avoid for you not to get sued. They will help you be in legal good books and can easily negotiate for settlement before an issue is taken to court.
2. Get Workers’ Insurance
Insurance helps takes care of compensation costs when they arise.
By getting a medical coverage for your workers, and a workers’ compensation in case of injuries, it gives your business peace of mind. You can insure your business against fire and if your business has a fire accident that affects other businesses, you will not be sued.
3. Incorporate Your Business
An incorporated business has a better standing in a court of law than a personal non-incorporated one. This helps you as a business owner by separating your property from that of your company. In the case your company can’t afford to pay for a lawsuit, you can get a settlement loan from Legal Bay.
4. Conduct Due Diligence in Contracts and Other Engagements
It’s always advisable to have any business agreement in writing and witnessed by an attorney.
This can be in the form of employee job contract, sales agreement or supplies contracts. These are the major sources of suits for small businesses. Ensuring that the contracts are well written and signed protects your company from matters that could rise and see your business being sued.
5. Be Honest in Your Undertakings to Avoid Business Lawsuits
A good business is guided by ethics and morals.
Ensure you treat your customers well and your staff. Also, pay your taxes, statutory deductions and observe the laws of running a business. This is the ultimate shield against corporate lawsuits. Avoid conducting risky businesses that might expose you to business suits.
6. Keep Records and Get a Means of Back-Up
You should develop a system of record-keeping to ensure that all the transactions are within reach but remain tamper-proof.
These can protect your business later when there are issues that are disputed. Good records can be in the form of paper, but can also be in digital format.
No Business Is Immune to Lawsuits, but You Can Avoid Them
As we have seen, no entity is immune to small business lawsuits and what matters is how prepared you are to avoid such.
By getting legal advice early enough, you provide yourself with a shield against unnecessary legal battles. But, running your business in an honest and transparent way provides you with comfort and ease of doing business without suits.
You can learn more from AZ Big Media about related topics. These include issues about managing your business and how you can achieve the best in your undertaking.
There are articles about real estate, lifestyle and normal day to day life.