The biggest mistake companies, small businesses and individuals in general make – is to NOT STAY IN CONTROL OF THEIR LEGAL ISSUES.
The legal aspects of your business or personal life is not glamorous and enjoyable as it involves endless paperwork and legal fees. Hence it tends to be put off till later or completely forgotten till trouble come knocking.
As hateful as legal stuff can be to you, you need to make a habit to keep your contracts and documents updated as well as stored safely.
This includes both your business and personal documents, like your Will or the beneficiaries of policies. The more outdated your documents get the bigger the risk is to you AND your family and business.
We still find contracts with dispute resolution clauses that name arbitration as the preferred means – if you’re a small business or company you must know that arbitration is more expensive than litigation and would drain the life out of you. Mediation is a more cost effective way of resolving disputes.
This is only a simple example, but ultimately what you would like to avoid from happening is a situation where you are forced into a legal battle or you may be held liable for damages suffered purely because of outdated legal documents or worse – no legal documents.
Legal documents are not always meant for the good times, it is meant for the sticky times. In essence the reason for actually keeping it updated is very simple: the law changes, people change, circumstances change and your business changes. You get smarter when dealing with clients and you implement changes to the processes, payment methods and obligations. Ideally you want to make sure that your legal documents are aligned with your business.
Now that you have decided to get into the habit of updating your documents on a regular basis – how are you going to do this?
The best way to achieve this goal would be to:
FIRST MAKE SURE THAT YOU HAVE ALL THE DOCUMENTS YOU NEED FOR THE DIFFERENT RELATIONSHIPS IN YOUR BUSINESS. THIS INCLUDES EMPLOYEES, INDEPENDENT CONTRACTORS, SERVICE LEVEL AGREEMENTS, TERMS AND CONDITIONS – THE LIST GOES ON.
THEN IF YOU HAVE ALL OF THE DOCUMENTS IN PLACE: HAVE YOUR DOCUMENTS REVIEWED AT MINIMUM ONCE EVERY 12 MONTHS. YOU DON’T ALWAYS NEED AN EXPENSIVE ATTORNEY ON YOUR PAYROLL. A BUSINESS PLUS PLAN ON AFFORDABLELAW CAN TAKE CARE OF THAT.
TAKE SOME TIME TO GO THROUGH ALL OF THE DOCUMENTS, ESPECIALLY YOUR TERMS AND CONDITIONS AND MAKE SURE THAT:
The payment terms are still relevant;
Your rates are updated;
You have made provision for situations that you cannot be liable for; and
The expectations that the client may have of your company is up to date;
ONCE YOU HAVE MADE SURE THAT EVERYTHING IS RELEVANT AND UPDATED, MAKE SURE YOU SCHEDULE IN YOUR DIARY THE NEXT REVIEW DATE OF YOUR AGREEMENTS AND DOCUMENTS. EVEN IF YOU ONLY PUT ASIDE 1 HOUR IN 6 MONTHS’ TIME OR HAVE YOUR LEGAL CONSULTANTS AT AFFORDABLELAW REMIND YOU.
LASTLY KEEP RECORD OF YOUR UPDATED DOCUMENTS. SAVE THE NEW VERSIONS AND MAKE SURE YOU DON’T GET CONFUSED AND START USING YOUR OLDER VERSION OF AGREEMENTS.
OUR TIP FOR 2020 (Post Covid-19):
A legal document is a working document. You need to realize this, the same goes for your marketing and pretty much anything, it is not a stagnating item. Once you realize this you will be in that unique position where you start making provision for the time when new situations or loopholes arise and documents need to be adjusted to make sure that you keep on protecting your business.
The moral of the story is that prevention is the best cure, and sometimes being penny wise, is pound foolish. It will cost you more in the long run to not be protected, than the expense to not have taken that 1 hour once a year to work through your terms and conditions.