PROTECT YOUR BUSINESS FROM BEING SUED
Getting sued might be something that you think will never happen to you. Maybe you’re right. But what if it did?
Are you doing all the right things to protect everything you’ve worked for?
While there’s no way to guarantee you’ll never be sued, there are some things you can do to protect yourself and mitigate that risk.
1. Have the Right Structure
A lot of business owners go into business without getting structuring advice. This is a common mistake, but it’s one that can be corrected so don’t worry. While many business owners go into business as a sole trader, other structures (Companies in particular) can minimise the chances of any lawsuits impacting your personal assets.
2. Be Compliant With the Law Obvious right?
The reality is that most business owners aren’t sure of all of their legal obligations. For instance, they may have employees but they don’t know the basics of employment law and what is required of them. That’s fine, that’s what lawyers are good for.
3. Document, Document, Document
Best practice for any business owner is to document your agreements with partners, employees and customers. Clearly outlining the rights and responsibilities of each party puts you in a strong position should you be sued. Recording everything in writing is one of the best ways to avoid litigation, particularly when it comes to employment agreements. If everything is documented then each party knows exactly what is expected of them. Every employment contract should also include a disputes clause. Having a disputes (or arbitration clause) clause could keep you out of court if you end up having a conflict with an employee.
4. Insurance
A lot of business owners I speak with are insured, but they do not have the right type of insurance to protect them. As a business owner if you do nothing else, then obtain advice from an insurer about the right type of insurance for your business. Having the right type and level of insurance will protect your business if it does end up getting sued.