Most business owners set up their businesses because they have a passion for what they do or sell. That was the case for me when I set up my first project management consultancy. As an employee, I loved running projects, solving problems for my employer and training others how to do the same. So when I got made redundant it seemed natural to set up a business to do the same things.
That’s when I started to learn the first, and sometimes harsh, lesson of being an entrepreneur. The need to market myself and my business. Other lessons followed. Setting up and running the accounts, building websites, writing proposals etc. But there was a less obvious area that often gets overlooked or neglected – staying legal.
Whatever business you are in there are a raft of rules, regulations and legislation that you need to comply with. Ignorance is no defence in the eyes of the law. This week’s blog looks at 5 areas you need to be aware of. There are plenty more, depending on the type of business you run so this is just your ‘starter for 10’. Ignore them at your peril.
Virtually every business has a website these days. If you don’t, you could be missing out on a lot of business. But with a website comes certain responsibilities and obligations. Besides having some basic information about your business such as name, address, phone number, VAT number (if appropriate), company registration details (if a limited company), there are a number of key statements that must be on your website with links from all pages.
This should set out the conditions that users of your website accept by continuing on the website. It should cover things like your copyright of your material used on the site. If you provide links to third party sites, you may want to state that you don’t endorse their sites or the content on them and you are not liable for those sites. If you recommend products or services, you should make it clear you are not responsible or liable for them. You might also want to exclude liability for any advice you provide on the site.
You might also want to exclude liability if a third party were to hack your site. You should be taking reasonable steps to ensure the surety of your site, but anyone can get hacked.
Is your advertising legal
We’ve all seen advertising that makes outrageous claims. We’ve also heard of the Advertising standards Agency taking those companies to task over them. But the rules apply no matter what size your business is.
- Your content must be legal, observe general rules of decency and be honest, accurate and fair.
- Are any claims you are making for your products or services clear, reasonable and suitably qualified or supported so that the reader is not misled.
- If you are quoting any facts, can you substantiate them? Are your testimonials and recommendations genuine and verifiable?
- Are there any additional charges for using the telephone number or other service to contact you, and if so, are they clearly stated?
If you are relying on your small print, it needs to be clearly visible and easily read by someone with normal vision. A quick flash of an A4 page in 6pt font just won’t hack it!
Your terms of business
You should have a clear set of terms of business and make them available to every customer. What you can exclude or limit liability for will differ for sales to consumers verses other businesses. Whilst it will be tempting to exclude as much as possible, remember that the courts may declare your exclusions unfair if they are unreasonable.
There are also some things you cannot exclude liability for such as death or personal injury caused by your negligence. Also, you cannot exclude someone’s statutory rights. It is always wise to have a qualified solicitor review your standard terms of business. At the Guildford Hub we have VIP member Chris Hunter or rhw Solicitors who has arranged for one of rhw’s solicitors to help a number of members on this very topic.
Contracts of employment
Even if you are the sole director and employee of your company, it is still worthwhile having a formal contract of employment. If you have more than one director or you employ staff this becomes an imperative. Nobody goes into business looking to end up in a dispute. Nor do they hire an employee expecting to have problems.
But circumstances change and interpretations vary so it is always best to have a clear contract of employment for all employees, including directors.
The value of a contract of employment often only becomes clear when something goes wrong. Verbal ‘agreements’ get disputed and you end up in court. In the absence of a contract of employment the courts a likely to err on the side of the employee – just ask any HR consultant and they will have a folder full of horror story case studies.
Every business should register with the Information Commissioners Office – the ICO. The ICO monitors and enforces data protection legislation within the UK. There have been many high profile breaches of data protection from online hacking to the loss of paper records. Again. Whilst the big cases get all the press, the legislation applies to businesses of all sizes. From May 2018 a new set of regulations are being introduced which will potentially impact all businesses. Called the General Data Protection Regulations, or GDPR, it will impact your email marketing and who you can market to. You will now have to have explicit permission, or be able to prove implied permission to send marketing e-mails to you list. As always. The rules differ between marketing to consumers and to businesses but the devil is in the detail.
Guildford Hub, as always, is looking to help you get to grips with the new legislation so, on Monday 4th December we have David Bittner offering his take on how small business owners can preserve their sanity and their customers despite GDPR.
European Union General Data Protection Regulations – even typing it in full feels boring. Many small business owners think that such legislation is only really for the big guys. That the regulators won’t worry about a little business like theirs. Well I would be so sure – or so complacent. The ICO is reported to have hired 100 new investigators for the implementation of this legislation. They will want to establish case law to back up their stance rapidly and the small guy is a much softer, quicker target than a big corporate with big resources. Learn how to stay the right side of the law and protect your sanity by attending this session. I know I’ve said this before, but this is definitely not one to miss!