There are many challenges that can arise as an employer and business owner. Regardless if your business is a startup or is well established, it is essential that you are managing how you minimize your risks as an employer.
Failing to properly protect your business could expose you to the financial risks of disputes including litigation or settlements. In order to protect your business and effectively mitigate your legal risks, the following tools should be applied.
Mitigate risk with contracts
Your business relationships with various stakeholders should be managed through contracts. Contracts will allow your business to extract benefits and mitigate risks. Contracts will allow your business to minimize risks in a number of ways:
- Assigns a scope to warranties
- Caps the amount of damages
- Excludes liabilities
- Imposes litigation period
In order for a contract to be legally binding, it must include legality, mutual agreement, consideration and capacity. For your protection, it is well advised to hire a lawyer to draft and review your business contracts.
Invest in insurance
You will need to purchase insurance for liability and for your business property. You need to ensure that your insurance value covers the replacement value of your business's physical property and that your insurance value properly covers your business's liabilities.
Consider your corporate structure
In order to protect an entire business portfolio from liability, a business can establish its corporate structure so that a number of companies represent their interests. This ensures that the operating company assigning contracts does not “own” all of the businesses key assets. The key assets are owned by other related companies (a holding company) that does not have established contracts with suppliers, customers or clients.
Your contract lawyer will help you to determine the best structure for asset protection for your company.
Protect the value of your business from potential litigation or settlement proceedings. Connect with a St. Catharines business lawyer to discuss the ways in which you can mitigate risk for your business. Book a consultation with a Niagara lawyer by clicking here.