The Most Common Legal Problems that Businesses Face

legal matters

Once you start running a business, no matter the scale, the world can get a lot more complicated. As a business owner, the danger of facing litigation should be a top priority. Besides having an abundance of family lawyers who handle domestic matters, some reliable corporate attorneys can also help you deal with a wide range of business-related issues.

Legal headaches can take any business owner by surprise and adversely affect their bottom line. Here are five of the most common legal problems that businesses face.

Angry Employees

Dealing with disgruntled employees is one of the most common legal issues a business owner faces, regardless if they’re running a small corporation or an empire. In most countries, workers have more rights than employers, usually in unions or ‘wrongful termination.’ If you fire a non-performing or underperforming employee, ensure they sign the necessary documents drafted by your lawyer upon termination to make the terms of dismissal clear. Letting them sign a final termination form saves you from the headache of legal actions they may make against you.


Another issue that many businesses face, especially those who are on a smaller scale, is licensing. Ensure you’re following your state’s local government’s requirements regarding business licensing to avoid facing hefty fees that you can easily avoid. The cost of business licenses varies depending on the areas where you operate.

Discrimination and Harassment

workplace conflict

When an employee or customer reports alleged discrimination, sexual, age, or ethnic claims can cause your business to face several serious problems. That’s why you need to ensure your human resources and legal departments have the proper protocols and paperwork to help them handle these types of issues when they arise. You can avoid this by emphasizing during the hiring process that you only hire the most qualified individuals, regardless of their age, gender, or ethnicity.

It’s also best to hold regular meetings to see if co-worker relations are going smoothly, and no issues between office cliques are happening.

Shareholder’s Agreement

If your business has over one shareholder, you should let your lawyer draft an agreement beforehand. That’s because when the company inevitably splits up or gets sold, and no shareholders sign legal agreements, legal battles will most likely ensue. Even if you see that your current shareholders are on the best terms, things can always go wrong when money’s involved. That’s why it’s not a good idea to leave any hint of gray areas when it comes to who gets what at the end.

Dissatisfied Clients

Customers, consumers, or clients dissatisfied with your services, products, or general business can file a class-action lawsuit against your company where they usually gather in large groups, attacking your brand. When you attain enough dissatisfied clients, a class-action case can do more damage than any competition, individual, or corporation, irreparably ruining your company’s image.

You can avoid this by being proactive and ensuring your customer support service provides the right assistance to your clients and promptly resolve issues for any flawed products or faulty services.

Inconvenient as they are, legal problems will always be part of operating a business no matter the scale, and through your journey, you’ll need to learn how to deal with them when they emerge. The best way to fight against this is by getting professional help from lawyers, allowing you to learn more and boost your skills necessary for real lawsuits in the future.