The 6 Different Types of Lawyers For Small Businesses
There are different types of lawyers, which makes selecting one challenging. We’ll cover six common business lawyers that can help protect your business interests.
The Importance of Lawyers in Small Businesses
It’s well known that lawyers are expensive, often out of reach for most small business owners. However, if your business is subject to a lawsuit, you’ll be glad you have a lawyer.
When you use the services of attorneys, they may help you avoid lawsuits. This fact could be worth the price your lawyer charges. Sometimes, a simple act of having a lawyer send a letter can prevent others from taking action against you.
Find an attorney with experience, as you don’t want to pay for someone to learn at your expense. When evaluating lawyers, ask a lot of questions and how they have helped other businesses similar to yours. You should prefer lawyers who specialize in your industry.
Having an attorney on hand can also help ensure you operate your business in a proper legal manner. They can review contracts and documents that you would otherwise assume are legitimate. Your lawyer can advise you on any changes needed.
Some lawyers are knowledgeable about tax issues, even if they aren’t accountants. They may have handled legal tax matters for other business owners and can make sure you don’t run into the same issues. Of course, you should have your lawyer consult with your accountant.
6 Types Of Lawyers For Businesses
People sometimes wonder what types of lawyers are available to them. Lawyers often specialize in either business law or personal law. For this reason, you’ll want to search for lawyers who have business law experience. The types of business law are important, too, and will depend on your industry.
The following sections describe six types of lawyers for businesses. When you read the sections, you’ll have a better understanding about which is right for your business.
1. General Business Lawyer
As the name suggests, a general business lawyer can provide legal advice on a wide range of matters. This lawyer has a hand in every legal discipline. If your business doesn’t deal with special circumstances, a general business lawyer may be well suited to your purposes.
When considering this type of lawyer, ask questions about various scenarios that could affect your business. If you don’t feel comfortable that your business would be covered in those scenarios, you may want to choose a more specialized lawyer. In some cases, a general business lawyer would be suited to assemble a team of specialized lawyers and would be the contact person for your case.
You should be suspicious of any lawyer who tries to convince you they know every aspect of the law. The law is too complicated for any one person to master the entire domain of law.
2. Employment and Labor Lawyer
Using an employment and labor lawyer only makes sense when your business has employees. If it does, your business should comply with state and federal laws. An attorney in this area of the law can help you draft employee manuals and ensure safety standards are in place.
Some of the employment aspects that could affect your business are wrongful terminations, workplace discrimination, and sexual harassment. This isn’t a complete list, which is why lawyers who are experts in this area are needed to keep your business protected.
If you feel you need to terminate an employee, you can discuss the issue with your lawyer. They can determine the best way to handle the situation. If there’s still a legal issue, the lawyer can step in and represent your company.
Employment law is one area that changes often. It’s your lawyer’s job to keep up with these changes so that you don’t have to.
3. M&A (Mergers and Acquisitions) Lawyer
When you buy and sell businesses, you’ll negotiate for the property and assets of those businesses. It may not always be clear what you’re entitled to during these negotiations. It pays to have a mergers and acquisitions (M&A) lawyer representing your interests in the transactions.
M&A lawyers who have worked with several deals understand the nuances associated with them. The opposing party will try to negotiate the best deal for their benefit. M&A is a complicated process, and trying to do this without an M&A lawyer is not a wise decision.
The documentation process is another complicated aspect of M&A deals. It’s likely for small business owners to overlook the needed documents. M&A lawyers know about the documents and filings. These lawyers are also knowledgeable in the laws concerning pensions and employee rights associated with deals.
Deals that involve intellectual property may require the expertise of an IP lawyer. Some M&A lawyers have this expertise, but it should never be assumed.
4. Tax Lawyer
Taxes for businesses can get complicated. For this reason, it pays to use a qualified tax professional, such as a Certified Public Accountant (CPA).
While a CPA can be beneficial when your business gets audited, there could be a situation where the tax authority decides to take legal action against your business. For this, you’ll need a tax lawyer.
Another reason to use a tax attorney is when you decided not to use the services of a CPA, or you discover that the CPA you chose was not qualified or crooked. Both of these situations could cause the IRS to pursue legal action.
When searching for a tax attorney, choose ones that have experience in dealing with tax law. They should be licensed to be a lawyer and have gone through tax law training, preferably a master’s degree. If you belong to an association for your business, consider asking around for a referral.
5. Intellectual Property Lawyer
If your company has trademarks and patents, you’re likely to need an intellectual property (IP) lawyer. These lawyers are qualified to handle matters concerning copyrights, trademarks, patents, and even brand recognition concerns.
An IP lawyer can also work to make sure your business isn’t infringing on the IP concerns of other companies. Most business owners aren’t trained to know when they’re in violation, which makes the IP attorney a valuable entity. IP violations are some of the highest payouts for lawsuits.
Information is considered intellectual property. People believe they can exchange data freely on the internet, but often find themselves faced with legal troubles for sharing the wrong data.
For example, if you use terms such as “Just Do It” or “Taco Tuesday,” you’ll likely hear from an IP attorney. Both of these terms are trademarked and highly protected by Nike and Taco John’s, respectively.
6. Contract Lawyer
Many business owners use templates found on the internet for their contracts. These may work, but could cause your company legal problems. Templates won’t cover the specifics for your business.
A qualified contract attorney can determine the right contracts for your business. Most deals require provisions not covered by templates.
Using templates could pigeonhole your business into unwanted obligations. The legal language contained in any contract, including templates, is complicated for the layperson to understand. You would be required to fulfill these obligations, which could cost your business much more than anticipated.
The cost of using an attorney will seem small compared to what you’ll pay for unwanted provisions. If your business uses contracts, consider hiring a contract lawyer to review them and make sure your business is represented properly.
Attorneys You May Face Litigation From In Business
The information in this article can help you when you face a legal situation. When you learn the details of the case, you’ll know which type of lawyer you’ll be up against. You can then work with an attorney to determine the best plan to handle it.
The most common lawyer that you’ll face is the one for general business. The upside is that the damages are likely to be the smallest with this type of lawyer.
As states are protective of their citizens, you can expect that employment lawyers will go after your business. The constantly changing landscape of employment law is fodder for these lawyers.
Legal issues from intellectual property are rarer than the others mentioned. However, this type of law is subtle. It can creep up on you for something seemingly innocent.
Contract law and mergers and acquisitions (M&A) will only affect your business if you deal in these areas. If your business is subject to contracts, then you increase the risk. M&A lawyers are probably the least likely you’ll face but could cost you the most as damages from deals are usually for large sums of money.
Resting Our Case
After reading this article, you should understand the benefits of hiring the right business lawyer. This lawyer will help ensure that your business stays out of legal hot water.
Some situations may require using multiple business lawyers. When this happens, you’ll want to organize the group into a team and assign one of them as the lead. This will help you to keep them focused on what is most important, which is your business interests.
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Frequently Asked Questions
Should you hire an attorney as a new business owner?
Business owners may not have the capital required to hire an attorney when first starting out. However, if you’re seeking venture capital, consider budgeting for legal counsel. In the long run, a good attorney may end up saving you money by keeping your business safe.
Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.