Even if your business is just in its early stages, you’ll need two professionals on your team: an accountant and a business lawyer.
Why you need an accountant is obvious — you need a professional to review your numbers, set up your accounts and prepare all of your local, state and federal tax returns. The reason for hiring a business lawyer, however, may not be so apparent.
But when your small business finds itself in a legal bind, that’s when you’ll realize the importance of working with a small business lawyer.
Instead of waiting to be caught up in lawsuits, it’s best to have a business attorney by your side now. But before you search for “small business lawyer near me” on Google, know what a business attorney can or cannot do for you, how to hire the right one and how much you may have to spend on their services.
What Does a Business Lawyer Do?
Business lawyers are attorneys who specialize in all legal matters concerning your small business. This includes trademarks, commercial leases, contracts, regulatory compliance in the workplace and business structure advice.
The best business attorneys also provide legal guidance in other complex aspects of your business, such as:
- Government complaints. In case government agencies file an investigation or complaint about potential legal violations, a small business lawyer can offer legal counsel. Without their guidance, you could face civil charges (or even criminal charges).
- Disputes arise in all business areas. These often involve partners, clients, customers or other businesses. You can end up in a lawsuit even if you did not do any deliberate action or if you found yourself in the middle of a contractual dispute that leads to litigation. Litigation lawsuits follow strict timelines. Once you find yourself in the middle of a lawsuit, hire legal counsel as soon as possible.
- Employment agreements. Although many small businesses begin as a single-person operation, many owners immediately grow their team. Business attorneys assist their clients in drafting employment agreements, which include employment contracts, non-disclosure agreements and non-compete agreements.
- Succession planning. The process of deciding what happens to your business when you can’t run it anymore requires careful planning, aka succession planning. Succession planning involves the passing of one business from one owner or group of owners to their successors. A small business lawyer can help you narrow down your options and choose the right one for you and your business.
- Privacy policies. A business lawyer can also help small businesses protect their customer information. In some states, businesses are required to have privacy policies, which is where businesses keep identifiable information.
- Selling or buying another business. In the future, if you want to sell your small business or buy another business and its assets, you’ll need a small business lawyer to oversee the transaction. They can help you with the consents, agreements, permits and other things needed for the sale.
- Business formation. Some of the most important business matters are handled before the start of business operations. A small business attorney can help you structure your business in a way that limits liabilities. Small business lawyers can also process the incorporation of your business to ensure your company begins on strong legal footing.
- Small businesses need a strong reputation to gain more clients. A single negative review can stunt your growth. A small business lawyer can get a court order to take down defamatory posts. For a quicker resolution, your business lawyer can send a cease and desist order to prevent the spread of negative online posts.
How Much Does a Small Business Lawyer Cost?
Business attorney fees vary according to the attorney’s experience, the type of service you need and whether you’ll need more attorneys. Most business lawyers use different fee structures, which include the following:
- Fixed fees. If an attorney charges fixed fees, they will charge a set amount regardless of how much work or time is involved. Fixed fees are often charged for specific tasks, such as contract drafting or reviewing.
- Retainers are upfront payments for services provided by your small business lawyer. Whenever your attorney incurs a cost while handling your matters, they’ll receive payment via their retainer, which you must replenish once in a while.
- Hourly fees. Small business attorneys with hourly rates charge you for the time they work on the case. This includes the time they spend on meetings, case research, drafting, document preparation, court appearances, phone calls and other activities involved with your case.
- Government taxes. Regardless of your attorney’s preferred fee structure, they are required to charge taxes on their legal fees.
Naturally, not all small business owners are thrilled with the idea of spending much on attorneys. So if you want to keep your legal costs down, have all of your documents in order and determine your attorney’s role in the case before you make an appointment. Also, make decisions after careful planning since frequently changing your mind can rack up your legal costs.
When you meet with your business lawyer, discuss with them your goals and ask them for an estimate for your needs. Next, decide whether the cost is worth it for the work you require. You can also ask your attorney if the job can be delegated to a junior lawyer instead of a senior attorney in the firm; the hourly rate may suit your budget.
Another way to know your legal costs would be to determine the need to hire a business attorney on retainer. Retained lawyers will prioritize you over regular business, and you learn about your estimated budget for legal fees. But this arrangement is only financially beneficial if you anticipate dealing frequently with legal issues.
How to Hire the Right Business Lawyer
Similar to other professional services, small business lawyers are not one-size-fits-all. Instead of hiring a lawyer ASAP, take your time in finding the right representation that suits your business’s legal needs.
When hiring counsel for your small business:
- Consider your small business’s needs. Your business type and size can start off your search. Look for a small business law firm that has the expertise you need now and in the future. It’s best to work with a law firm that has a diverse skill set. Look for a lawyer that has worked with businesses similar to yours. They’ll be familiar with the contracts you’ll need, as well as the legal issues you may face. Industry knowledge also helps them effectively protect your business. If you need help with estate planning, go for a lawyer with experience in estate planning.
- Research business lawyers and seek referrals. You may feel overwhelmed with the number of business lawyers in your area. Fortunately, online reviews can give you insight into potential lawyers. Read the reviews and the ratings. Also, ask other small business owners about their experiences with other lawyers. Referrals from other small business owners in your industry are helpful. Ask them about the law firm’s track record in representing other small businesses.
- Consult with potential law firms. Make a shortlist of candidates and conduct an initial interview with them. Ask them questions about their services and follow up on their responses. Also, learn more about their experience in your industry. Next, explain your goals as a business owner and ask them how they can help you achieve them.
Once you’ve hired a business lawyer, it’s important to establish a rapport with your attorney since you need to be on the same page.
Does Every Business Need a Lawyer?
Most small businesses put off hiring an attorney until legal authorities are serving them with summons. Working with a business lawyer once you are sued may be too late. Once you have been served with a complaint and summons, the problem has occurred.
It’s just a question of how much you’ll have to pay in terms of attorney’s fees, court costs and settlements — all the expenses needed to settle the legal problem.
But you can handle some issues on your own, such as:
- Reserving a domain for your website
- Writing a business plan
- Submitting IRS forms
- Creating contracts or buy-sell agreements with partners
- Documenting LLC meetings
A business lawyer is a helpful addition to your small business team. Instead of dealing with legal issues in the future, protect your small business now with the right lawyer.