Startups: Plan ahead to avoid costly legal disputes (part V)
Your product is an initial success, happy days, and so you now begin to scale up. Most of the stuff in my previous posts in this series should continue to be relevant and some things will become more prominent as your team grows and your operation becomes more sophisticated.
Health and Safety
If you move into your own premises and have more people in your offices, the health and safety risks increase.Therefore, ensure you are aware of your obligations and implement appropriate training and processes.
By end of 2017, all companies must enrol qualifying employees in certain pension schemes, save in limited circumstances.
Build on your initial handbook by including more policies to ensure a consistent approach to common workplace issues. These additional policies would likely include appropriate parental leave or sickness absence policies.
Share schemes and options plans
If you are thinking of providing equity entitlements to your employees, then you should put in place tax efficient plans that are appropriate for your business.
Dealing with investors
If your business looks viable you may attract investment from Angels or VCs or on crowdfunding platforms. Therefore you should keep a tight a ship to avoid workplace liabilities that might worry investors. Also, you may have to negotiate the terms of Founders’ employment documentation as part of any funding round and deal with data protection issues when disclosing employee information.
3 Key Tips to avoid legal battles at this stage
1. Know your obligations
There are lots of useful sources out there for information about your obligations as an employer and protecting your business. Many of them are free, like this series of posts!
2. Be prepared to spend some money to do things right
When it comes to issues like auto-enrolment and putting in place appropriate share schemes, it is better to pay a reputable service provider than to spend even more to fix problems and pay any fines, penalties or back-dated tax at a later point.
3. Get the right advisers around you
If you do things the right way from the off, that's most of the battle won. But then you need to know what is up ahead. So whatever the issues may be - tax, pensions, IP, employment etc, get in with a trusted adviser who will set you straight.
The articles published on this website, current at the date of publication, are for reference purposes only. They do not constitute legal advice and should not be relied upon as such. Specific legal advice about your own circumstances should always be sought separately before taking any action.