GREAT 17 IDEA: Hire a Great Lawyer
One person who can help you in good and bad times is an experienced attorney. Save money when you can, but don't scrimp when it comes to getting solid legal advice.
Once you set up your business structure, you'll need a savvy lawyer to buy or sell real estate, form a partnership, create job applications, and write employee handbooks. (See the tip box on pages 28–29 for diversity tips.)
Working with a good small business attorney will help you avoid legal troubles involving staff, vendors, and customers. He or she can also prepare books and records when you are seeking outside investors or applying for a bank loan.
Finding a good attorney is not as challenging as you may think. There are about a million of them in the United States. The best way to find a good lawyer is to ask other small business owners, your banker, and your accountant for recommendations.
You can also find a lawyer through a legal directory or at various web sites. Most large libraries have a copy of the Martindale-Hubbell Law Directory, which provides brief biographical information about lawyers in your area. State bar associations offer free referral services. Be prepared to pay a fee for an initial consultation, although some lawyers won't charge you.
Remember, you have to feel comfortable telling your attorney everything, so choose someone you can confide in. Very important: work with someone who knows your industry.
My wonderful attorney, Cliff Ennico, is a small business expert, speaker, and author. He's kept me out of hot water for years. He not only drafts our contracts but provides excellent insights and legal advice. He's also one of the sweetest and funniest people I know.
Some attorneys who work with entrepreneurs may offer to provide legal services in exchange for stock in your company. That may be worth considering. The hourly fees you'll pay depend on where you live. Business owners based in New York City and Los Angeles generally pay higher legal fees than those living in Omaha, Nebraska.
Some questions to ask prospective attorneys:
- Are you a member of the state bar and licensed to practice law in this state? (If your company does a lot of interstate commerce, consider hiring an attorney who can practice in the federal courts as well.)
- What types of small businesses do you represent?
- How long have you been practicing law?
- Please provide three references for me to call. (If the person balks at this request, move on.)
How to Stay Out of Legal Trouble
Many business owners don't realize that federal rules and regulations affect them as soon as they have 15 or 20 employees. Julie Hickman, founder and CEO of Diversity Compliance & Testing Group in Shawnee, Kansas (www.diversitycompliancegroup.com), has created several online training and compliance programs for business owners and employees.
Not knowing the law is no excuse for not complying with the Americans with Disabilities Act, Title 7 of the Civil Rights Act, the Lily Ledbetter Fair Pay Act, and a laundry list of state and federal statutes.
“Unhappy employees can go right to the Equal Employment Opportunity Commission and file complaints,” said Hickman. “Then, it can get ugly.”
She said part-time and full-time employees have rights that can't be ignored. Her two-hour online training program for managers costs $29.95. Regular employees pay $19.95 and need to understand the material and pass a 25-question test.