Business Law
HELPING BUSINESS OWNERS FIND ANSWERS
Las Vegas, NV Business Lawyer
As a business owner in Nevada, you have in-depth knowledge about your industry and extensive experience serving your customers with quality products and services. An area where you may be lacking is the legal factors and implications that affect your company throughout its lifecycle. From the business regulations of the Nevada Secretary of State and local rules in Las Vegas to federal tax codes, there is a massive list of laws to know. Errors, omissions, and failure to comply with the law can lead to devastating consequences for your business. Plus, without a background in law, you may not realize how to leverage factors that protect your company and boost growth.
Starting, operating, and growing a successful business requires a solid foundation, so it is critical to have a legal framework in place. Many companies do not have an in-house legal department, but you can still gain advantages when you work with a skilled partner who will provide valuable advice and counsel.
At Escobar & Associates, we are adept at serving the needs of our business clients as your dedicated, offsite legal department. We take time to understand your industry and the intricacies of your organization so we can help you navigate the complicated array of legal issues you face as a stakeholder. Please contact our firm at 702-789-1422 to schedule a free consultation with a Las Vegas business lawyer, and read on for some important information about the laws that affect your company.
Starting Up Your Business
You start a company because you have a great idea, but the legal start requires careful consideration. There are multiple types of business formation options, each of which carries its own pros and cons. Depending on your current circumstances and long-term business goals, you might opt for one of the following:
- Corporation: One of the main reasons people start a business as a corporation is that it insulates stakeholders from personal liability. You cannot be responsible for the debts or obligations of the company unless you engage in misconduct that led to the liability. Under federal tax laws, you can elect to be treated as a C or S corporation to maximize tax benefits.
- Limited Liability Company (LLC): This business form is similar to a corporation in limiting liability for stakeholders. However, some owners prefer the LLC because there is less recordkeeping. There is also no requirement to conduct an annual shareholder meeting,
- Sole Proprietor: When you are in business on your own, you can operate as a sole proprietor and sole stakeholder. There are risks with this type of company because it will not always protect your personal interests from the liabilities of the business.
Initial Documents and Agreements
Besides filing the proper forms with the Nevada Secretary of State, there is also some organizational paperwork to address. A corporation must prepare Bylaws and/or Articles of Incorporation, which cover issues such as the board of directors, officers, and issuance of stock. An LLC can address the same topics via an Operating Agreement. Though they are not required to complete one by law, LLCs may need such an agreement in dealing with financial organizations, investors, insurance companies, and other partners.
In addition, it is useful to consider shareholders’ agreements during the initial startup period. The shareholders are the owners of the company, and they play a unique role in smaller businesses. Owners are also operators, and they want to protect their investments and future growth. Through a shareholders’ agreement, you can achieve various goals.
- Determine what happens in the event of a stakeholder’s death or disability;
- Restrict shares in the company so that a shareholder cannot sell off to another unrelated party;
- Make arrangements for a corporate buy-back of stock if a member dies or becomes disabled, a transaction that is often funded by insurance;
- Establish trigger events that justify forcing a stakeholder out; and,
- Provide for the sale, closure, or other termination of the company.
Other Common Agreements for Business Owners
As you settle into doing business, there are many other contracts that govern operations and could be part of expansion efforts. A common type of business agreement is leases, which may be for real estate, vehicles, or large equipment. Depending on your industry, you may be the lessor or lessee, so you need to know your rights in both positions.
It is also wise to be familiar with such contracts as:
- Employment contracts and agreements with executives;
- All documents related to loans;
- Credit agreements if you extend credit to customers; and,
- Insurance contracts.
Many companies will also enter into agreements regarding restrictive covenants, including confidentiality agreements, non-disclosure agreements, and non-competition agreements. You can protect your business by requiring employees to sign a restrictive covenant, but there are strict legal rules. If you do not comply with the law, your agreement could be unenforceable.
Employment Law Issues
If you will be hiring employees, there are numerous topics to bear in mind. The federal government has enacted anti-discrimination laws, and there are some similar provisions under Nevada statutes. A violation of these laws may lead to serious liability issues for your company, as you could be forced to pay fines, damages, and other costs to an employee who suffered because of misconduct. The application of these laws depends upon the number of workers you employ, but you should be aware of the key provisions:
- Anti-discrimination statutes prohibit companies from treating workers differently on account of protected characteristics, such as ethnicity, gender, religion, race, age, and disability.
- Harassment is a type of discrimination, so it is also unlawful to create a hostile work environment for an employee due to protected characteristics. Quid pro quo sexual harassment occurs when an employee in a position of authority offers benefits in exchange for sexual acts.
- Your company could run afoul of laws on unlawful retaliation if you demote, exclude, take away benefits, or take other adverse action for discriminatory reasons. Employees can also sue for wrongful termination if you fire them on illegal grounds.
Business owners must also comply with all wage and hour regulations set by the US Department of Labor and Nevada law. The minimum wage for the first half of 2023 is $9.50 per hour for employees who get health care or $10.50 for those who do not, increasing to $10.25/$11.25 in July.
Your Company’s Interests in Intellectual Property
Your business owns or has an interest in many types of real estate, equipment, inventory, and other assets. However, you cannot only focus on these tangible items. Your organization likely has a significant investment in intellectual property, which comes in many forms. Our Nevada business law attorneys at Escobar & Associates will advise you on strategies to protect:
- Processes, designs, software, solutions, and marketing plans;
- Your brand logo, images, web content, social media posts, photos, videos, and other art;
- Customer lists and contact information; and,
- Other interests in patents, trademarks, copyrights, and trade dress;
Other Business Laws to Know
The details will depend on your company, how it is organized, your workforce, and many other factors. Some examples of the laws and legal concepts you need to know include the following:
- Tax laws for income, property, employment and payroll, and others – at the federal, state, and local levels;
- Safety regulations established by the Occupational Safety and Health Administration (OSHA);
- Immigration laws, if you will work with foreign-born workers on employment-based visas;
- Various environmental laws that cover waste, drilling, construction, and other areas;
- Building codes and permit requirements
- Special licensing for certain professional corporations, LLCs, and partnerships;
- Insurance requirements; and,
- Laws on collections and overdue accounts.
Another important point if you have employees is compliance with Nevada workers’ compensation laws. You are required to carry insurance through an approved carrier, which pays out benefits to qualifying workers who are hurt on the job. Fortunately, your company cannot be sued by the employee under the rule stating that workers’ comp is the sole remedy.
Types of Business Litigation
At some point along your company’s timeline, it is inevitable that disputes will develop. Many times, you can resolve disagreements through negotiations, especially when you have an attorney to advocate on your behalf. In some cases, you might benefit from alternative dispute resolution (ADR) to get things back on track. It may even be required by a statute or contract. Mediation and arbitration are two options that are frequently used by business owners.
Still, if you cannot work out conflicts out of court, it may be necessary to either pursue or defend a lawsuit. Litigation is a complex process, from filing a complaint to going through to trial. In between, there are motions, court appearances, discovery tasks, and depositions. A lawsuit may be the result of:
- Breach of contract actions with a vendor or business partner;
- Enforcing a confidentiality agreement, noncompete, non-disclosure agreement, or other restrictive covenant;
- Suing for collections on overdue accounts;
- Defending a personal injury lawsuit if your company or an employee was negligent in causing an accident;
- Disputes among shareholders, based upon corporate laws or a shareholders’ agreement; or
- Claims for breach of fiduciary duty for misconduct by the board members or officers.
Alternatives to Guardianship Through Estate Planning
After a person is incapacitated, guardianship is the only way for loved ones to gain authority to act on their behalf. However, it is possible to make arrangements via your estate plan while you still have full capacity to make decisions. This overview should inspire you to look into options that avoid guardianship proceedings entirely. It is possible to do as part of your estate planning, including:
- Health Care Power of Attorney: With this document, you name a person to act as your agent in managing your health and well-being if you are incapacitated. The agent is the equivalent of a guardian of the person, except that you do not need to go to court. Your agent has the power to make decisions on treatment, consent to procedures, request medical records, and handle all other tasks related to health matters.
- Power of Attorney for Property: Instead of going through guardianship proceedings to appoint a guardian of the estate, you can sign this document. You will name a person as your attorney-in-fact, with all of the powers you designate for your real estate and personal property.
How Your Company Benefits from an Attorney’s Guidance
For one, you are less likely to find yourself involved in business litigation when you have a lawyer to advise you. A common reason for lawsuits is mistakes, many of which can be avoided when you consult with an attorney.
Our Las Vegas, NV, business lawyers at Escobar & Associates also deliver a wide range of legal services for all aspects of your company’s operations. You can rely on our team for many important tasks:
- We will consult with you about goals for your business, which will guide us in advising you throughout the company’s lifecycle.
- You can trust our team to counsel you on the business formations that would suit your needs, and we will handle all filings.
- An attorney will assist with initial agreements, as well as drafting, reviewing, and negotiating with others you encounter.
- If your company becomes involved with litigation, our team has the trial advocacy skills to protect your interests.
- The legal landscape of business laws and statutes is crowded, and we have the in-depth knowledge necessary to provide you with critical information.
Winding Down Your Company
Eventually, the time may come when you want to close your business or end your involvement in it. There are different options to consider, and some of them are worth looking into sooner rather than later.
- Family businesses may pursue opportunities for business succession through younger generations. Even when he or she is not related, the same strategies can be employed to transfer the company to a valued employee. Keep in mind that this plan for terminating your interest in the business will take the longest since you may need years to train and develop.
- You might want to work with a broker to see about interest in selling your company to another. These transactions can be accomplished via an asset purchase, stock acquisition, merger, or any combination.
- Some business owners simply want to end their company, close the doors, and turn off the lights. Dissolution involves a winding down process, which ensures any creditors of your company get paid.
For all major decisions regarding closing your business, it is likely you will need permission from all stakeholders who have the right to vote. A shareholders’ resolution will accomplish this task.
Set Up a Consultation with a Las Vegas, NV Business Law Attorney Today
This summary of common business law issues in Nevada is helpful, but there are many other details stakeholders need to know. It is counterproductive to take your attention and effort away from your company to address legal issues, so trust Escobar & Associates to tackle the challenges. We have years of combined experience handling the needs of our clients so they can focus on operating and growing their businesses. To learn how we can assist your organization, please call 702.789.1422 or visit our website to schedule a free consultation at our offices in Las Vegas.
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