Aside from tax code, employment and labor law, and antitrust laws, there are eight other basic categories for federal business laws and government regulations. Each of them may not necessarily affect your business in the same way. It varies depending on the industry and may not even become a huge concern.
However. you’d want to ensure that your company is still in compliance. Give these laws the same level of importance and attention to avoid issues in the future. A business lawyer would be helpful in figuring out which laws and regulations would exactly apply to your business.
For now, here’s a breakdown of common government relations on business.
1.Advertising
Having a good advertising strategy can really help your business grow. But before you begin, you have to know the basic rules and government regulations to ensure that your ads are truthful and not deceptive. Your ads must provide a clear and specific claim to better represent your product or brand.
Using testimonial ads is effective but it also comes with additional regulations. That is why it is important to know specific advertising rules to ensure you are following all additional requirements if there are any. If a business is caught violating these rules, it can result in fines.
Here are some ways to avoid misleading your customers:
●Stay in compliance with labeling laws for consumer products. List out all of the ingredients and chemicals contained in your products.
●Be knowledgeable of the specific rules for selling and advertising your products over the internet.
●Understand the rules for specific products before you advertise them. This is specific to each industry. Working with a lawyer would help you know what the specific rules are.
●Be knowledgeable of the rules for marketing and advertising through phone or email.
●For environmentally friendly claims in advertising learn the rules for green claims.
2.Email marketing
Email marketing is related to advertising. There are separate regulations that investments need to comply with under the CAN-SPAM Act.
Here are the main regulations of the Act that you need to know:
●Don’t use misleading headers
●Don’t use headlines that are deceiving
●For every advertisement, clearly indicate it in the message
●Always include the business name and address
●Provide the option to opt-out of the emails or unsubscribe from the mailing list and honor the request promptly
Violation of any of these regulations is subject to fines. Be sure to apply these rules in setting up your email marketing strategy.
3.Environmental regulations
Depending on the industry, you have to be well acquainted with the various types of environmental protection laws, especially if you’re marketing food, cleaning products and/or anything that claims to be natural, organic, or eco-friendly. There are dozens of environmental regulations that can affect your small business that’s covered by both the federal and state levels.
The EPA Small Business Gateway is one of the many great resources that businesses use to stay in compliance with environmental laws. Aside from that, you may consult your lawyer or the state environmental protection agency to ensure your business meets the requirements.
4.Privacy
The business has access to all the personal information of its staff and employees. It is their responsibility to safeguard and keep these things private. There are a variety of rules and regulations about how employers need to manage and secure these data.
If by chance a business discloses one of its employee’s information, such as Social Security number, name, address, health conditions, bank number, credit card, or personal history, the business can be sued for disclosing any of these sensitive information. The Health Insurance Portability and Accountability Act prohibits the sharing or releasing of health data without the patient’s consent. Whether it is a family member who is asking for the said information, it would be safe to ask for consent from the employee before releasing such information.
Employees have the right to privacy in their workplace. Employers have to make sure it is well balanced against their own employer’s privileges so that they can monitor the business operations efficiently. It is important to understand the rights you have with your business to monitor your employees. Businesses have to be clear and transparent about monitoring all employees to establish a good working relationship in the workplace.
5.Licensing and Permits
Aside from federal laws and government regulations on business, you also have to consider several state regulations for small businesses. Many state and local governments have their own specific requirements and it also varies depending on the state. All of these are equally important as federal laws and regulatory requirements.
A business license is needed, especially for many states and local governments. If your business happens to fall in heavily regulated industries, such as health or childcare, a business license is a must. Without proper licensing, you can be fined or worse, your investments may be revoked the right to operate.
6.Insurance
Businesses are legally obligated to purchase Workers Compensation Insurance for all employees upon hiring them. All states except Texas are required to purchase this.
It protects both employer and employee in case of accidents on the job. Employees get medical care compensation for lost income during the injury. The insurance company will then defray costs of lawsuits if the injured worker decides to file for one.
Depending on the circumstances, employers aren’t required to purchase other types of insurance. If your business has a contract with the government or applied for a government-guaranteed loan, you’ll need business insurance.
7.Reporting pay data
Businesses that employ more than 100 people are required to report the salary amount they pay each employee. If you’re a federal contractor and employ more than 50, you’re also required to do the same.
It has to be broken down to the degree of race, gender, and job category to the Equal Employment Opportunity Commission. This is required by the federal non-discrimination law that businesses comply with. This ensures that a woman is not paid less than a man who has the same job title and responsibilities. The EEO-1 form has to be submitted by the end of May every year.
8.Collecting sales tax
Businesses that sell physical goods collect sales tax from customers. They’re required to submit taxes to the state revenue department. Some states don’t collect sales tax.
This law specifies how businesses must collect sales tax in the state which has a nexus. Nexus refers to hiring employees or physical retail shops in the state. Online sellers may need to collect sales tax in any state they make sales on.
If you have a nexus, you’re required to collect sales taxes. Businesses in Alaska, Montana, Delaware, New Hampshire, or Oregon don’t need to collect. Note that exemption depends on what you’re selling.
Government Regulations: Does It Hurt or Help Your Business?
There are different opinions about how government regulations affect businesses. The US is the 7th best country in the World Bank in terms of business. A few people think there are still too many government regulations and not all of them are necessary.
Regulations protect consumers and it ensures that all businesses are treated equally as we all contribute fairly to society. Too many regulations can restrain our businesses from creating more jobs that contribute to our economy. The amount of regulation also changes when the politics change. Regularly check with your business lawyer to stay updated in the industry.
Government Regulations on Business: The Bottom Line
Small business owners have so much to learn when it comes to government regulations. One good thing about it though is that you’re not alone in the process. Everybody else, even your competitors, continues to learn as much as they can about government regulations to stay competitive and compliant. It’s better to stay on the right side of the law.
Make it a habit to check with your local SBA office when the need arises. Ensure that you have your own business lawyer to represent you as well, more so if you need additional counseling on where to go.
Based on Materials from Fundera
Photo Sources: Castex, Pixabay, Pexels, Tampa lawyer, Vianinja, Flickr, Madc