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Practical employment law information to support your business, from Clover HR

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Setting up a business involves complying with a range of legal requirements. Find out which ones apply to you and your new enterprise.

Every business needs to be aware of its obligations under minimum wage and equal pay laws, as well as recent pensions auto-enrolment changes.

What particular regulations do specific types of business (such as a hotel, or a printer, or a taxi firm) need to follow? We explain some of the key legal issues to consider for 200 types of business.

While poor governance can bring serious legal consequences, the law can also protect business owners and managers and help to prevent conflict.

You must comply with legal restrictions on employees' working hours and time off, or risk claims, enforcement action and even prosecution.

The right employment policies are an essential part of effective staff management. Make sure any policy is clear and well communicated to employees.

Whether you want to raise finance, join forces with someone else, buy or sell a business, it pays to be aware of the legal implications.

While sick employees need to be treated fairly, you need to ensure that 'sickness' is not being used as cover for unauthorised absence.

Marketing matters. Marketing drives sales for businesses of all sizes by ensuring that customers think of their brand when they want to buy.

Most pregnant employees are entitled to maternity leave and maternity pay, while new fathers are entitled to paternity leave and paternity pay.

Commercial disputes can prove time-consuming, stressful and expensive, but having robust legal agreements can help to prevent them from occurring.

As well as undermining morale, illegal discrimination can lead to workplace grievances. Employee discrimination is covered by the Equality Act 2010.

Whether your business owns or rents premises, your legal liabilities can be substantial. Commercial property law is complex, but you can avoid common pitfalls.

Home, remote and lone workers are becoming increasingly commonplace. Key issues include communication and how to manage and motivate people remotely.

With information and sound advice, living up to your legal responsibilities to safeguard your employees, customers and visitors need not be difficult or costly.

The right approach to consulting with and providing information to your employees can improve employee motivation and performance.

As information technology continues to evolve, legislation must also change. It affects everything from data protection and online selling to internet policies for employees.

Disciplinary and grievance issues can be a major burden to employers. Putting in place and following the right procedures is essential.

Following the right dismissal and redundancy procedures helps protect your business and minimise the risk of a legal dispute at tribunal.

Intellectual property (IP) isn't solely relevant to larger businesses or those involved in developing innovative new products: all products have IP.

Employment tribunal claims are a worrying prospect for any employer. A tribunal case is a no-win situation – even if the claim is unjustified.

Knowing how and when you plan to sell or relinquish control of your business can help you to make better decisions and achieve the best possible outcome.

From bereavement, wills, inheritance, separation and divorce to selling a house, personal injury and traffic offences, learn more about your personal legal rights.

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Contractual and commercial disputes can be costly, time consuming and stressful. Minor disputes can escalate, damaging relationships or even threatening the survival of your business. Clear, written contracts with customers and suppliers minimise the risk of disputes. Similarly, having clear agreements in place with employees, shareholders or partners can help to anticipate potential conflicts and prevent them before they arise.

Understanding how contracts and contract law works, knowing how to prepare terms and conditions and what to do if you end up in a dispute, can help you avoid legal difficulties when you are negotiating a contract with a business (different rules apply to contracts with a consumer).

Negotiation, dispute resolution and litigation

While a pragmatic and positive approach can go a long way to avoiding unnecessary disputes, you need to recognise that disputes are inevitable. There will be times when unacceptable mistakes are made or when you need to fight for the right deal rather than accept an unfair outcome.

Aim to negotiate a constructive resolution to any dispute, rather than to punish or triumph over the other side. Key objectives might include maintaining a working relationship and minimising costs and disruption, as well as seeking a financial settlement or agreement. Take into account practical negotiating issues, such as the strength of your argument and what the other side is hoping to achieve.

If firm but fair negotiation does not succeed, alternative forms of dispute resolution include mediation or arbitration. Well-planned agreements will include dispute-resolution clauses, setting out how any dispute will be dealt with in the event of a disagreement. For example, a lease might specify that rent reviews are subject to arbitration by the Royal Institution of Chartered Surveyors (RICS). Litigation in court should be a last resort.

Legal advice and expertise

A long-term relationship with a firm of solicitors can underpin your approach to avoiding disputes. For example, your solicitor can advise you on drafting standard terms and conditions and ensuring that they apply to any sales, setting up employment procedures and so on. Preventative measures like these can be a highly cost-effective use of legal expertise.

A long-term relationship may also be a cost-effective approach to recurring disputes, such as debt recovery issues - a frequent source of disputes between businesses.

Specialist advice may be needed for particular types of dispute: for example, if you want to take action against a professional adviser for negligence.

Bear in mind that legal disputes can be expensive, particularly if they reach court. You may want to consider legal insurance to cover your legal expenses as part of your strategic approach to managing disputes.

Action before litigation starts

There are various practical rules that govern litigation. These rules are called the Civil Procedure Rules and Practice Direction on pre-action conduct (covering England and Wales only).

The objective is:

  • to encourage both parties to settle the claim before going to court
  • to put the parties on an equal footing
  • to save time and money by following a standard process each time

If you don't follow the rules the court can take this into account and you may end up losing out financially (eg not being able to claim the majority of your costs even if you win).

The rules set out the documentation that needs to be provided before and during litigation. For example, the person making the claim needs to write a 'Letter before action' and the person defending the claim must acknowledge this letter and provide the documents you have requested.

Even after litigation has been started the court will often adjourn court proceedings for alternative dispute resolution, especially if one party requests it or if such a clause is incorporated in your businesses terms and conditions and has not taken place.

In some claims, especially those involving technical information or high value disputes, the courts also operate an early neutral evaluation of the parties' positions. However, in most situations this is not as effective as a negotiated settlement.

Reviewed by Samantha Jackson, barrister, Clerksroom