Home Law 5 Common Legal Issues Businesses Face and How To Avoid Them

5 Common Legal Issues Businesses Face and How To Avoid Them

5 Common Legal Issues Businesses Face and How To Avoid Them

Although there are a wide variety of legal issues a company can face, there are several which are common enough to be found in companies of all sizes and in all industries. These include dissatisfied customers, disgruntled employees and overlooked government protections or regulations. Knowing what some of these are, and how to avoid them, can help you better navigate the legalities around your business as you grow from startup to booming corporation or franchise.

Disgruntled Employees

Terminating employees is not a fun practice, and if not done correctly, it can land you in legal trouble. It is important to have a clearly defined process for termination and to have the employee sign all the necessary paperwork to complete the process. Incomplete terminations can easily turn into lawsuits, even if your company has done nothing wrong. If you ever do have a disgruntled employee take you to court, it is important to hire a certified court reporters Phoenix company to help you obtain the detailed records you need from the proceedings. This can help you find strategies to avoid similar cases in the future.

Discrimination and Harassment

The policies and procedures you have in place to avoid and handle discrimination and harassment in your company can go a long way towards avoiding this type of lawsuit. Make sure that you have resumes for all job applicants, and you thoroughly check them, to prove that you have hired the most qualified people for each job. You can then have each employee read and sign the policies you have against discrimination and harassment, frequently check-in with teams and departments to make sure those policies are followed, and ensure that your procedures for handling these allegations are understood by workers at all levels. This can help you spot and stop any issues before litigation, as well as cover your interests if you need to terminate someone for repeated harassment or discrimination incidents.

Immigration Audits

There are ways to work legally in the United States as a non-citizen, and ways that both businesses and immigrants get around the system to work illegally. If the government performs an extensive, surprise audit of your employee’s work status and finds that you have some illegal hires, it can ruin your company with lawsuits, fines and fees. The best ways to avoid this are to ensure that you are thoroughly checking everyone before hiring them and conducting your own audit on a regular basis. Even those who were legally hired may have missed a renewal date for the proper paperwork, so it is important to keep up with the process on your end and remind employees of upcoming deadlines.

 Dissatisfied Customers

Class action lawsuits are filed when multiple dissatisfied customers band together to sue your company for damages due to unfulfilled promises, dangerous products or misleading information. These can drive your company under through paying fines and fees as well as through the bad press they can generate. The best way to avoid this kind of legal action is to keep in touch with your customers through feedback, complaints and ratings on various platforms. When you know why they are dissatisfied and can handle it on an individual level, you can change the products or processes before the court is involved. Adding a CRM to your company’s process is one way to give an added level of care to your customers. 

Copyrights and Patents

One of the first things that your lawyer will advise you to do when starting a company is to copyright, patent and trademark as much of your intellectual property as possible. When you have these types of protections, you can sue other entities who encroach on your brand. You can also see which patents or copyrights are already taken during the application processes to make sure you are not encroaching on someone else. It is a good idea to work with a lawyer who has experience in this area of practice, he or she can help you navigate the process as well as litigate on your behalf if someone encroaches on your intellectual property rights.


Although you cannot foresee and avoid all legal issues with your company, there are some concrete steps you can take to minimize your risks in the most common areas. By drafting the best policies and procedures to deal with everything from hiring employees to resolving customer disputes, you can avoid many of the legal pitfalls companies face. You can also check in with workers and clients to see where small problems exist which can develop into lawsuits if not handled quickly and effectively, and protect your intellectual property through copyrights, patents and trademarks.