Laws and regulations regarding businesses differ from state to state, and it’s your responsibility as a business owner to understand your state’s rules and regulations. There are details and nuances in employment law, business operations, taxation, and more. While this is by no means an exhaustive list, it can get you thinking about your obligations as an employer.
Business Permits and Licenses
To open and maintain a legal business, you may need industry-specific licenses and permits on top of the standard certificates. Also, keep in mind that you’ll need federal, state, and sometimes local licenses and permits.
A few permits and licenses required across industries and localities include general business licenses, local operating licenses, signage licenses and permits, sales tax permits, and zoning permits.
Compliance with the IRS
As a business owner, you must procure an employer identification number (EIN) and see to it that your business pays all required state and federal taxes. Small businesses in the U.S. typically have to pay income, self-employment, payroll, capital gains, property, and dividend taxes. State taxes vary from state to state, so be sure to consult an accountant or business tax expert to ensure you comply with all requirements.
Hiring and Labor Laws
Most labor laws center around making sure that employers provide a safe and discrimination-free workplace for all employees. For example, when hiring, you cannot discriminate based on protected classes such as race and gender.
It’s also essential that you make sure to take any reports of harassment or safety issues seriously. Labor laws also dictate what benefits you are required to provide to your employees based on their classification.
All employees have rights that business owners must honor. The three landmark Supreme Court cases that dealt with employee rights were the
Civil Rights Act of 1991, the Americans with Disabilities Act of 1990, and the Equal Pay Act of 1963. You can review a complete list of federal employee rights laws here.
Workplace Safety and Workers’ Compensation
Employers have an obligation to provide a safe workplace free of hazards, as defined by the Occupational Safety and Health Administration (OSHA). For example, OSHA requires employers to properly maintain equipment, post signage for safety hazards, provide adequate safety training, and communicate operational procedures.
In addition, most employers legally have to provide workers’ compensation insurance. However, workers’ compensation laws vary from state to state, so it’s important for employers to research their state requirements and coverage minimums.
Environmental Protection Agency Regulations
Your business must comply with EPA regulations regarding the disposal of toxic chemicals and carbon emissions. Violations can result in massive fines as well as the loss of trust from your community, employees, and customers.
In the U.S., the Federal Trade Commission (FTC) protects consumers through advertising rules and regulations. The FTC requires that “claims in advertisements must be truthful, cannot be deceptive or unfair, and must be evidence-based.”
Intellectual property laws protect your rights to your inventions, designs, artistic works, etc. For many forms of intellectual property, you will have to secure a patent or register a copyright to protect your ideas and keep others from using your work without your permission.
Consumer and Data Privacy
In addition to employee privacy, you must also protect your customers’ privacy. Privacy and data collection laws vary based on your company’s size, but you generally have to inform consumers when you collect personal data.
Launching and managing a business comes with great responsibility. You owe it to your customers, clients, employees, and yourself to practice care regarding legal compliance. For good reason, many businesses hire consultants or legal professionals to help them along the way. When it comes to the law, you can never practice too much caution.