Every entrepreneur struggles to find enough
time to complete the day’s tasks. Sales targets have to be met,
issues raised by customers have to be resolved, and there are
usually several administrative matters to be attended to.
Legal matters usually get very little
attention from a small business owner. But there are literally
dozens of laws that apply to small businesses that need to be
complied with. Additionally, the authorities regularly issue
amendments and new regulations. The proprietor of a small business
must keep abreast of all these changes.
Awareness about the laws that impact your
business can be good for your bottom line as well. What are your
legal rights and obligations regarding your employees? Can you
prevent a competitor from copying your successful new business
process or product?
Here is a brief list of some of the legal
issues that every business owner should have an understanding
about.
Getting paid for the services that your firm
provides or the products that it sells can sometimes be difficult.
Customers may delay payments or even refuse to pay.
What can you do in such a situation? If you
think that you would not like to deal with the customer in the
future, you could be tempted to send a legal notice.
Sometimes, this seems to be the simplest and
most logical course of action.
But you should not take such a decision in
haste. Experienced business owners know that there could be many
reasons for non-payment. Before going down the legal path, you may
want to spend a little time to understand why your payment is not
forthcoming.
In any event, it is always advisable to hold a
discussion with your customer before you actually initiate legal
action. Proceedings in Singapore’s civil courts can be both
expensive and time-consuming.
The success of a small business hinges on the
efficiency and productivity of its workers. You may employ various
categories of employees in an effort to minimise costs. Many firms
use a mix of full-time workers, part-time staff, and casual
employees to meet their organisation’s objectives.
However, remember that it is necessary to
enter into a “contract of service” with those you employ.
Singapore’s Ministry
of Manpower has stipulated that all employers must issue
“key employment terms” (KETs) in writing to their staff.
Which are the KETs to be included in your
communication with your workers? Among other details, you must list
the job title, main duties and responsibilities, working hours, and
salary details. The government’s guidelines list 18 areas that
could be included.
Employing staff places great legal
responsibility on the business owner. Your employment contract
should also cover the terms and conditions governing termination
of employment. If you fail to follow the guidelines that have
been laid down, it could lead to a legal case being filed against
your company.
Many small businesses neglect to protect their
intellectual property rights (IPR) effectively. What exactly is
intellectual property and how can you establish your rights over
it?
IPRs fall into three broad categories:
How do you go about establishing your rights
over your intellectual property? Fortunately, Singapore has one of
the most robust IPR regimes in the world. The Intellectual
Property Office of Singapore provides all the details that
a small business could need regarding patents, trademarks, and
copyrights.
Registering your trademark is quite simple and
inexpensive. The cost ranges from S$240 to S$374 per trademark.
A small business should carry out a review of
its products and processes and understand whether any of them can
be protected by law. Taking pre-emptive measures regarding your IPR
can help you to ensure that your business remains profitable in the
long-run.
In the normal course, every organisation collects data
about its customers. While this information can be of great use for
your business, it also places a legal responsibility on your
firm.
Singapore’s Personal Data
Protection Commission, a statutory body established in 2013,
requires every organisation to follow certain data protection
obligations. For example, you can collect data from customers only
with their explicit permission. A client may choose to withdraw
this permission at a later date. If this happens, you are required
to inform the client about the consequences of withdrawal and then
comply with the request.
It is also mandatory to make reasonable security
arrangements to protect your customers’ data.
How can you ensure that your systems are not hacked?
What are the precautions that you can take to save yourself from
expensive litigation in the event of a data leak?
Some of the measures
that you can adopt include limiting personal devices at
work and keeping your encryption software up-to-date.
Legal advice can be expensive. Many small businesses
are hesitant about engaging a lawyer on account of the cost it
involves. They usually put off contacting a lawyer till they have
no other option.
However, deciding not to seek an expert’s advice may
prove to be more expensive in the long run. How can you find a law
firm that is both reasonably priced and effective?
You could seek the advice of your business peers and
ask them for a reference. It is also a good idea to engage a lawyer
who specialises in your industry or who has expertise in a
particular field. If you are planning to initiate legal action for
recovery of your dues from a customer, you should engage a legal
firm that has experience in such matters.
When you give an assignment to a lawyer, remember to
monitor the case closely. This will allow you to provide the inputs
that are necessary to ensure that the legal firm has all the
information that is required to address the matter at hand.
Disclaimer: The author is not a licensed law
practitioner in Singapore. This article is based on the author's
personal research and understanding into the topic, and does not
constitute legal advice.
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