NEWSLETTER
USING LEGAL SERVICES WISELY
As many of you know, my number one focus with clients is to help them achieve their goals in the most effective way possible. I want to give you the best value for your money, and since legal costs are a part of doing business, I want to help you so that you spend your legal budget wisely.
Good Sense Saves Dollars
This means that we want to do things quickly, but not so quickly that we overlook important details, that we want to take the most economic approach in the long run, so we want to avoid being "penny wise and pound foolish" as the old adage says, and we want to create documents and relationships that are "bullet proof" so to speak in that they cannot be later dismantled in a way that causes problems.
This means not creating avoidable legal problems.
How? Follow this important tip:
Don't Be An Ostrich
Do not ignore adversarial communications. This means that when you get something in the mail, by email or a phone call that pertains to a past due account, a looming dispute with a business associate, employee or customer, address it immediately.
Use Your Lawyer Wisely
It is often better to obtain legal advice prior to responding because when a situation becomes adversarial, everything you say can be used against you. You, as the subject of the communication, may have an emotional reaction which may be expressed in your response, but an attorney can respond with the knowledge of your legal position and without emotion, which will lead to a quicker and less costly resolution to the problem.
So you may ask, how does obtaining immediate legal advice reduce my legal budget? The answer is this: if a dispute escalates because you do not respond or because you respond with emotion or without full knowledge of your legal rights and obligations, you will certainly spend more on legal fees to resolve the situation. Everything is negotiable and you will have a much better leveraged negotiative position if you respond early rather than late.
To reiterate, attend to all communiqu's promptly and get professional advice in order to avoid costly legal fees down the road.
Be well, be prosperous and be grateful!
As the End of the Year Approaches…
As the end of the year approaches, except for the retail industry, businesses often lose some of our operational focus as thoughts of food, family, friends and frivolity prevail. Many organizations do not focus on business activities, other than the annual company party, and we often experience a degree of downtime in November and December.
There are several things an organization can do to prepare for a prosperous new year.
Tax Planning
Use this time to start getting your tax documents together for the CPA. Submitting your data early will allow more time to discuss ways in which to approach the return, and will ensure that an extension does not have to be filed. You can also assess whether to take or abandon an S-election if this is appropriate for your company.
Assess Entity Structure
If your CPA has been encouraging you to incorporate your business, this is the time to do it. Forming a new entity as the New Year begins will allow you to take advantage of all of the afforded liability and tax savings for the entire year.
Corporate Formalities
Make sure you have held your annual directors and shareholders meetings and that you have filed your annual report with the state. Remember that these activities are necessary to maintaining the protection of the corporate veil.
Office Organization
Organized offices allow companies to function more efficiently. End of the year downtime presents the perfect opportunity to clean out, throw out and get organized. Establish standard filing and operating procedures for dealing with all documents. This will ensure that nothing is misplaced and that all correspondence is handled in a timely manner. Mis-filed documents and failure to respond to correspondence can lead to all manner of costly legal problems.
Review Lessons Learned
All challenges are valuable when we learn from them. Review operations for the past twelve months and examine any adversity or losses you may have experienced. Formulate a plan to avoid a repeat of like problems or, in the event that such challenges do arise again, to enable you to deal with them more efficiently. Obtain professional advice in the areas of tax, finance, contracts, negotiations, operations, human resource management or any other areas that may be prudent or necessary.
Plan For Prosperity
Many businesses operate without a succinct business plan. Reviewing profit centers and expenditures and forecasting for the coming year will help make your business more viable. It may be prudent to expand into new areas or contract operations, deleting or reducing products and/or services that are outdated or simply not providing a worthwhile revenue stream. This will allow you to set solid, manageable goals to guide you through the next four quarters.
Pro-active planning and utilizing the holiday business lull in practical ways will help ensure that your business runs smoothly and prosperously in the New Year. The Law Offices of Debra C. Scheufler, APC is committed to your success. Feel free to contact us for more information.
Happy Holidays to all!
Managing Payroll Practices
Did you know that wage and hour violations are among the most costly liabilities for California employers? Most companies are aware of and are effective at implementing protected class awareness so we see far fewer discrimination and harassment complaints, but the wage and hour laws are complex and sanctions and damages for failure to comply with these regulations can be financially devastating.
Who is really exempt?
Determining the difference between exempt and non-exempt employees can be the first challenge. We know that certain "learned professionals" are exempt from wage and hour laws. This category includes attorneys, doctors, CPAs and real estate brokers, but not nurses (with some exceptions), paralegals, bookkeepers and real estate agents.
Certain salary based executives and administrative personnel are also among the exempt classifications but the law is very specific as to the requirements of each of these positions in order for them to be exempt. Employers sometimes assume that a position is exempt but the actual duties of the employee make the wage and hour laws available to him or her. An executive must be regularly supervising two or more people in a regularly recognized department and spend at least 50% of his or her time engaged in exempt duties. Easily, these legal parameters can seem vague and it is important that employers have the way in which they categorize employees reviewed to ensure compliance with the law.
Payroll and Timekeeping
Employers are often surprised to learn that payroll services do not always accurately prepare paychecks. Paychecks must include certain information including the name of the employer's legal entity and the inclusive pay period, not just the period end date. Penalties for violations of these rules can be extremely costly and do not even arise out of failing to fully compensate the employee!
Hourly Rate
Did you know that tips, commissions and service charges must be included in calculating the hourly rate for purposes of determining overtime pay? Failure to do this can result in fines and penalties in any amounts not paid plus the employees daily rate for up to 30 days following termination. Imagine the expense if several employees brought such a claim.
Additionally, attorney's fees may be awarded to an employee who prevails in a wage and hour claim, which can increase the cost of the claim to the employer who is not in compliance.
As you can see, it is important to have your payroll practices regularly evaluated even if you use a payroll service or have in-house or outsourced human resources professionals. California and Federal labor laws can be an overwhelming maze for employers. In our ongoing effort to mitigate your legal costs, we are available to help you evaluate and correct your payroll practices.