Nobody likes to be blindsided. Bosses don't like it and neither do employees. Being blindsided implies getting hit from a direction from which you least expect it.
This can happen in business and it is no fun. It typically occurs when we don't know what we don't know. And of course, under almost every circumstance, "ignorance of the law is no defense."
There are laws at the federal and state level that apply to almost everything. There are clauses in our insurance policies that we may never read, and thus never know about, that can have serious consequences. So, how do we avoid being blindsided?
First, we need to assume that there is some regulation over almost everything do in business. From the moment we even interview, before we even hire employees, there are laws covering our conduct. There are questions we can legally not ask. If we ask them and then don't hire based on the answers, there is potential legal liability. That means getting with your lawyer before beginning the employee route and learning what you can and cannot do. If you don't want a lawyer, research on the internet. But your research needs to be state specific too. While federal laws apply no matter where you are in the US, state law varies.
There are legal questions around treating a person as an independent contractor and an employee, with serious consequences if you make the wrong choice.
There are legal consequences in how you treat your employees with regard to overtime and in paying them a salary rather than on an hourly basis.
How you classify your people matters for workers compensation premium purposes. If you play games and then get audited at the end of the year, there can be a huge audit premium.
If you truck across state lines and have CDL drivers, there are a whole batch of requirements that must be met. There may be random drug and alcohol tests. Truck logs must be kept. Fuel tax issues arise.
How are we supposed to know this stuff if nobody tells us? We have to learn to ask. If we rent trucks, ask the rental company? Your accountant, your lawyer, your insurance company all have a lot of information that you need to have. If you have fork lifts in your warehouse, the forklift company has valuable info for you.
If you keep hazardous materials in your shop, how they are stored and handled is a matter that OSHA cares about and so does your insurance company.
And of course, the big one is the tax man; except it is tax "men" and they reside at the federal level, state level and numerous more local levels. Make sure you know what jurisdictions have taxing authority over you. Penalties and interest are often way higher than the tax owed itself.
Do you know "what a hostile work environment" is? Do you know what a "zero tolerance policy" is?
So much to know, all of it far afield of the work that our businesses usually do. But don't ignore this stuff. If you do, it can put you out of business and stick you with personal liabilities.
Entrepreneurs need to recognize there are things they don't know and find the right advisors to give them the right information.
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