When it comes to business, lawsuits are not a rarity. In fact, many successful business owners and executives will have to deal with litigation at some point throughout their career. It may not always be possible to prevent litigation, however, there are steps you can take to protect your business and best interests when disputes occur. If you own a business and are concerned about the chances of business litigation arising, then read on for tips on how to avoid this from happening whenever possible. After all, you’ve taken the time to develop your business idea and move forward, so the last thing you want is to get set back because of a communication issue.
Improve Your Communication
If you want to prevent disputes with employees, clients, and competitors, then having good communication is essential. One of the main foundations of every business is good communication, as without it, your company may suffer. As a business litigation lawyer clients trust at Eric Siegel Law explains, you must always set aside time to develop and clarify what the expectations are, and make it a routine habit of the following:
- Not over-promising what you can deliver.
- Keeping the promises that you do make, but if you are not able to, then letting the other parties know right away along with a plan on how you are going to resolve the problem.
- Being proactive by not avoiding difficult conversations or situations. By being avoidant, it can easily cause the situation to escalate.
- Evaluating how your tone may be felt by the other parties, and realizing that messages on emails or texts can make it harder to convey your actual tone.
- Not being afraid to compromise, as doing so can help the issue get resolved before it turns into a legal matter.
- Enforcing best company practices for how your employees should communicate with you and each other.
Prioritize Written Documentation
To protect your business and yourself, you must document all commitments and communications in written form. Keep your emails organized, don’t partake in handshake deals alone (always follow up with a written contract), and avoid templates online as each state has different legal considerations and you may not know if these templates are current or accurate for your intended use. Have your legal team review every contract, including agreements with vendors. Your lawyer can help you draft or review deal contracts, develop employee handbooks, document policies and procedures, and more.
Review Your Business Formation
Business owners may be surprised to learn that their structure of business is actually not appropriate based on their type of work. To reduce liability and litigation, you will want to have your legal team decide which is the accurate corporate entity for your company. You will need to keep a record of your corporate documents, annual reports, and meeting minutes if your business formation type necessitates that you do so. Be sure to abide by every formality so that you are as protected as possible from personal liability.