Building A Strong Legal Foundation For Your Business

Let's talk all things legal today. I'm so excited to have Lauren Boyd, the founder of Guide My Business, a boutique law firm, here on the podcast. You guys know what a soapbox I tend to go on when it comes to trademarking your business and not purchasing trademark infringing or copyright infringing goods and the importance of if you have something that looks like it has a trademark, making sure the brand you're buying it from has a proper licensing agreement. I have seen countless boutiques and retailers get there into entire social media accounts taken away, have their Shopify taken down by simply not doing this one thing right. So I'm really excited today that Lauren's going to join me and we're going to walk through all the really important legal aspects of your business. Not just on this topic, but also on HR law, on hiring employees versus contractors, and also making sure that you have your business set up on a strong legal foundation from the very start. Because take it from me, I've been there, I have tried to skimp and skim save and not do all these things right from the start. And I don't want you to make that same mistake. So today, I'm so excited, you guys. Please join me in welcoming the founder of Guide My Business, a boutique law firm, my friend, Lauren Boyd.

Let's talk about your business strategy and the juicy details of what actually works from mainstream fashion to fashion on Main street and the entire ecosystem behind it. How do we scale your company and do it with the balance and the happiness that we all see seek? Let's hear from those insiders, experts and strategists that actually make it happen. I'm your host, Ashley Alderson from the.

Boutique Hub and I can't wait to chat. Hey guys, welcome back to the podcast. This week, oh, we are gonna digest a huge scary topic for so many business owners. But we're gonna make it not so scary today. So, Lauren, I'm so pumped you're with me because all things legal I think can feel so, so daunting for business owners, but it really doesn't have to be. Tell me about that. Tell me about like that very first step into working with legal for most small business owners. How do you break it down and make it easy to digest?

Yeah, you know, really, I find that it's not, it's not a scary thing. In fact, I think it's really empowering. I think, you know, most things in business are mindset and, you know, having your foundation set and feeling that peace of mind is really there to help you scale. Of course I love the piece of avoiding the legal liabilities associated with those things that you're protecting yourself against. But I often find, and I actually, I love this stat companies and I'm going to preface this, not every company needs to have a registered trademark. It depends on your business. However, do you think most businesses should. There's actually a stat that says businesses that trademark their business within the first year of doing business own three times as much revenue in the first five years in businesses that don't. Now I can say comfortably that there are revenue opportunities with having a trademark. Right. Not only are you protecting yourself from confusion of a brand similar situated, you know that you can't really necessarily protect yourself against otherwise. There's licensing opportunities that are a wonderful generator, especially in the retail space. But also mindset, the type of founder that's going to take the step to trademark is the type of founder that's doing other things that are making a business more successful. So I think that goes across the board for anything legal. It's think about it as what's going to give you peace of mind and really drive you to scale this because you have that peace of mind.

I really like that outlook. I've never thought about it that way. But I can see where so many small businesses get started and they're like I'm too small for this, I don't need this yet or that will never happen to me. And that sort of mindset perpetuates itself into a number of other mindsets that really set you up for failure from the beginning. So I love that getting started, getting started right with a strong legal foundation is important. Talk to me about what that would look like. Like I'm a brand new boutique owner, I'm a brand new e commerce store. What are the first steps I should take when I meet with a legal to protect my business?

So the first things, and these are self help things, the first thing you can do is file yourself an llc. If you're here in the US that is like the most hybrid entity. It's approachable now. A lot of people say, well I can just create an Instagram handle or start an Etsy shop or grab a domain and I'm a business. But I want to urge you again, bring the mindset piece, have a stronger foundation. We're not lemonade stands anymore. We've all probably done it when we were young. But that's not how we want to treat your boutique. You actually want to treat your boutique like something you're going to grow and scale.

Yeah.

So give it an entity that's going to allow you to do that. So go get yourself an llc. Easiest way is go to either your Secretary of State or corporation commission website, look for.gov address. It's going to be different in every state. So I wish I could tell you like this is how you do it. But Google, you know, forming an LLC in your state, I would avoid kind of the third party services that are just going to up towards you. I really do think that those entities, the Secretary of State's incorporation commissions are very helpful. And if you have questions, you can call. And I would rather you be in the driver's seat of getting that filed. In fact, I was just filing an entity for a passion project of my my own last night. Filing an entity allows you to directly go over file an ein, which is basically like your business Social Security. You can do it all at one time, which is wonderful. The moment you filed your LLC you can go and file your EIN. Of course, the IRS, you do the EIN on the IRS.gov website makes it complicated because you can only do it during business hours, but you'll actually automatically immediately get an EIN number. And you take those two things. Once your entity is filed and your EIN number to the bank, you get yourself a business bank account. Your bookkeeper is going to love you because you're never going to lose track of any of those business expenses. But I like it because it's super clean. And the reason that we form entities and the reason that I just formed a separate entity is because think of an entity like a bucket. It's giving you kind of a defined liability. So instead of having everything that you do in your business become personally liable for it, you're now saying that those business activities, those assets, those liabilities live in a smaller bucket. It's reducing your overall liability. When you open up a business that's distinctly different, that may have a different exit path or exit strategy, you also want to have a separate business. Think of it kind of, I would like to say like if the expenses look different, it's probably a different entity. If the customers look different, it's probably a different entity. And that's just going to reduce your overall liability and allow you to kind of assign assets and liabilities within those smaller buckets. So that's going to be like any business. This is how you start. And this is how you start in the sense that you're not starting, you know, like a lemonade stand, but you're starting with the mindset of your building to scale. Because when you have a bank account, an EIN number, now, you're actually ready to hire when the time is right. You're, you know, you can. You probably hear a lot of buzzwords of an S Corp. That's a tax filing. It doesn't actually change your entity status, but all that, you know, you just need to call up your accountant and say, okay, I think I'm ready, and they'll give you guidance on what that milestone is. And you can now move over to the tax advantages of an S Corp. And that's just, again, a tax election. All of those things are. Are things that you can do because you've laid the groundwork of an llc, an ein, and a bank account.

Oh, this is so good. So good. And I know, I just want to reiterate, like, so many people skip these steps and come back to them later. And then it's just unraveling, like, oh, I had a bank account, but my Social Security number was tied to it. So I just want to go back and reiterate this one more time. So when you form that llc, it's easy to get started as a sole proprietor. Right. And using that Social Security number, but it is not safe. So can you take one step further for me, when you're talking about protecting your personal liability as, let's say, a sole proprietor versus an llc, talk to me about that liability and the risk you're opening yourself up to if you don't have that LLC one more time.

Yeah, absolutely. So really thinking about it, like, everything we're going out and doing for our business is now becoming a personal liability of your family. Yeah, that's what being a sole proprietor does. Now you might think, well, I'm just so new, I haven't really started yet. Arguably, any activity has a risk associated with it. I like to say if it didn't, I wouldn't have a job. So I hate to be a pessimist, because naturally, I'm really not a pessimist, but, you know, really, I'm just being a realist and I'm setting you up for success. I hope your business never has any problems. And these safety nets that we're setting in place, you know, only give you a sense of security. But if you have an llc, a separate entity that is going to allow those assets and those liabilities to live within that entity, and unless you sign a personal guarantee, those liabilities, the contracts you sign, the debts you accrue, the, you know, are going to live within that entity, Beware that you can sign personal guarantees like for a lease. Anyone who has a brick and mortar knows that they'll ask for a personal guarantee that is standard. There's really, I doubt you're going to find a landlord that isn't going to ask for a personal guarantee. And, and those are the types of assets that will touch your personal as well. But those are very few and far between. And so I want most of your liabilities and assets to live within one. And once you start to especially open a brick and mortar, have clients come through your door, you have employees, there's just a different level of risk. And I don't want your house to be on the line.

Yes, that is exactly right. You could be driving to a vendor setup and kill somebody on the road. And yes, you have insurance, but that person comes back and sues you. And now if you are not an llc, they can take all of your personal assets versus you being an LLC and having access to the assets the LLC owns. I also want to go back. One more thing that you said that I think is really important for our industry specifically is if you're a boutique owner or a retailer and you have an LLC for that business. But now let's say you want to start selling wholesale or you want to do something a little bit different, this is the time where you go in form a second llc. I think you said if you have different customers. Right. Or different products, that is definitely a time. And there's tax advantages that. To that whole process as well. Can you talk a little bit about that? Another advantage of having multiple LLCs for these multiple different products.

Yeah. So in addition to reducing your overall liability. Right. Because you're creating smaller buckets, I want you to think about the opportunity for, you know, to ensure that those write offs and the things that you're doing in those entities can be written off. In that sense, there's. I'm not an accountant, thank God I have one. Because tax is such a changing world. But there is a lot of tax advantages to ensuring that you are capturing those liabilities that you can write them off to find tax efficiencies. Sometimes they'll find ways to have one business consult for the other as a way to move money up the most tax efficient vehicle. So there's a lot of ways to kind of bring your two entities together when it comes time for taxes and defined tax efficiencies. But really I'm looking for you to reduce your liability because if you have a problem over here with a wholesaler, you know, wholesale customer. I don't want them to also be able to get at the assets of your boutique. So you want to kind of think about how do we reduce that overall liability and make that bucket. I love that.

Talk to me more about. You talked about trademarking your name from the start and that importance. I think that's something that when we go through and we name our business, we get all excited about it. We maybe find the social media handles, but not everybody does enough due diligence to make sure their name is different enough from those who already exist. Talk to me about that importance of, like, getting your name right from the start and then going ahead and trademarking that name as soon as you can.

Yeah, I apologize if you can hear my little one, but that's mom life. She's having fun in her room right now. But really for the trademarking piece. And it's funny, I'm a small business owner too, so remember that anything I'm doing, I'm giving you advice for I'm doing myself. In fact, we are launching, like I said, a passion project and I went through several names to decide which one had the strongest chance of trademark, and that's the one that we're going with. I'm very excited about the name. In fact, I love it more than the names we started with because it's a process and. Right. I was checking, I. I was doing a trademark search and then I was also doing a domain name search and then I was also doing an Instagram and Twitter handle search.

Right.

I get we're trying to pull together all of the assets, but the most important of all of those is actually the trademark. And I feel like that's really the last one on people's mind because maybe they filed the llc. I hate to break it to you, but the LLC is actually not going to give you protection out of your state. It's just going to ensure that no one else in that state has the same LLC name. But a trademark is the only thing that's going to give you protection to ensure that no one else has a confusingly similar. That's the standard confusingly similar brand in the same industry. And that is a level of protection in this online digital world, whether you have a brick and mortar and an online side of your business, whatever it may be that you just can't avoid. Unfortunately, we put a lot of money and effort into our goodwill and our branding and we do get emotionally attached to it. So. So I like to say, where will your business be in six months? Because if you're going to continue to invest in the goodwill and the recognition of your business, it's really the time to think about the trademark right now. And so that's kind of what I urge people to do, because I don't want you unknowingly to be using someone else's name and get a cease and desist letter. Unfortunately, I've seen it, and it's heartbreaking because we are so attached to our brand. It's an extension of ourselves, so we completely understand. But it's a wonderful way for you really to, you know, feel that security and growing and scaling and continuing to invest in the brand recognition because you're going to own your brand.

I would echo that. I would echo that. I've seen so many negative experiences of that same thing in our own community where there's not just the cease and desist letter of you're using my name, but they file a takedown with Shopify, completely taking down someone's work website for using the same name. So it's so important from the start. I cannot overemphasize this enough to get this right right away before somebody else comes after your name. Are there other things? Like if you know someone else has a similar name as you, and let's say you've been in business for a while, you both have, are there other things you should do? Like, is it still fair game, whoever gets the trademark first, or are there other things you can do to protect yourself before you get to that point?

So really, if you know that there's some competitors in a similar space, I would really urge you to start down the path of trademarking. There's kind of two levels of priority. The level of priority from who used it first. Right. Priority of use, and then there's also priority of filing. So there is a certain level of priority that you get from filing the application and pursuing it. You know, the trademark office is actually going to look at registered marks. It's going to do a wide search of the industry in the area in general. However, they're really going to leave it up to other business owners who don't have a registered mark, you know, to. To be keeping an eye out, which we know is really would be really hard to do when you hire a firm. So, for example, our firm, once you're in our system and we're going through the process of doing a search for you and you're in our portfolio, we keep an eye on new filings and we can say, hey, this looks confusingly similar, and we've been very successful in preventing new filings from being confusingly similar to our existing clients who are, who are going through the process of filing and registering their trademark or after they've had a registered trademark. And so there really is benefits to kind of putting your hat in the ring and getting that level of protection. We live in this very digital world and, you know, unfortunately there's, there's copycats and it's really hard to say sometimes when a boutique popped up that has a similar brand to yours and we want to stand out, that's really the benefit here is we're trying to stand out. We're trying to be able to defend and, you know, advocate for ourselves. So if you feel like you are very similar to somebody, you know, it's definitely worth it. I honestly believe it's easier to rebrand when you have the time and the space to do that because you have, you know, you kind of gave yourself the space and proactively looked into it as opposed to receiving a cease and desist letter. Yes, I will say, in boutiques, another common area of cease and desist is if you're creating your own products that have sayings, which is super popular these days, is very much. Copyright infringement is a very big topic. And so I want to urge you, if you're going to be ordering inventory, to do a clearance search. Have somebody that you trust do a clearance search to see what else is out there. I have had retail owners come to me and say, you know, I just got a Susan Desistletter because we launched this collection with this work, you know, this phrase on it. And, you know, so and so came at me and said they had, you know, this, that and the other, and it's been true. And they have a bunch of inventory that they ordered that now they can't sell online and it can be really detrimental. So clearance searches are also a really great friend if you're a creator. And I want to urge you, just because other people have done it in the past, do not copy other people's designs. If I have seen it too many times, if you go on Etsy and you look for a Disney T shirt, there's a lot of people who, I guarantee you don't have a Disney license to be able to sell. And that's why having a registered copyright and registered trademark have so much benefits, because you actually have the ability to license out your designs for other people to create. That's how all the sports teams do it. That's how universities do it. And I want to Urge you to think about your ideas of this new.

I feel like we could write a book about this inside the Boutique Hub because we see it every day. And my answer is always this, Lauren, it's if someone printed a T shirt with your face on it and was selling it for a profit and you didn't get any of the profit, how would you feel about it? Because it's your face.

Right.

It would piss you off. So it is no different when you are selling stuff with Disney or with the characters from Yellowstone or with your favorite sports team or with the smiley face, for Pete's sake. That's a whole nother rabbit hole. There are so many of those things to look out for. If it is recognizable, if you're selling this thing, this T shirt, this product, whatever, because it has a recognizable mark on it, chances are it's owned by that other person and you shouldn't be selling it for a profit unless you have it licensed, unless you have a licensing agreement. Talk to me about that, about how do I know when I am buying something wholesale from somebody else if it's legal? How can I check for the licensing agreement and run the search you were talking about to make sure I do have proof that I can sell this thing?

Yeah, honestly, do your due diligence. You should be able to check on the, you know, copyright office. You can go to the USPTO as well, look for trademarks, but ask for it. If you are actually going to spend money to provide a license, they need to show you proof of ownership. And then I also want you to check in the license agreement for what's called an indemnity provision that says any, you know, accusations of infringement on your use of that license, that mark that you're licensing, that they'll indemnify you for the costs of that infringement because, you know, you don't want to be saddled with the expense of, you know, selling, you know, selling a good that you thought you were properly licensing. And then someone comes and says, actually, I own that. That's an expense that they should bear because they are profiting off of the license. So look for an indemnity provision. Ask for proof. Honestly. Due diligence and advocating for ourself is our biggest, biggest responsibility as business owners. And I think oftentimes we're just scared to ask because we don't want to upset anybody. But I want to urge you to reframe that and think about how you want to do business with good business owners, people that are paying attention. And so these are not nitpicky things that you're just asking to piss somebody off. You're asking these things because they are good and sound business questions that should be asked. So go the extra mile, make sure you're doing your due diligence.

This is so important and I just want to mention this. Those of you who are shopping online wholesale, we're building, Lauren, we're building an entire wholesale platform called Hubventory for our industry to shop from. And one of the most important things when we build this platform, it's built by the industry, for the industry. It's very grassroots roots. We just got done hiring a full time employee with the purpose of looking through thousands of SKUs every single day to look for this type of thing that somebody, even though we vet every brand on the platform, it doesn't guarantee they don't have stuff like this like lurching in the background. So we have someone full time just looking for this type of material. And also we're trying to build a way where brands can offer like, yes, this is licensed and here is my proof of license so a retailer can buy with confidence in that product. Because no other platform has ever done this and it's rampant across the Internet.

Oh, it's so important.

Like I have seen so many retailers like lose big time, lose big time on investments because they bought something and they wanted to be nice like you said and oh, I trust this person. I bought from them for years. Of course they would have sound business practices, right? And they didn't. And it came back to bite everybody in the butt. So this is such an important topic. Thank you for covering it and hopefully everybody who's listening, you can find some peace of mind in this as well.

And one more thing, I want to kind of to round this out because I love what you're saying about advocating for, you know, proof of license, ensuring you have those rights, but also thinking about the manufacturers. Let's take it one step further. Are you working with manufacturers that have good business practices? Can you guarantee that they're not over producing your product and allowing replicas or infringing products to go out? Because we have seen that with some of our retailers where we're like, this is the same, like we've actually bought product that's infringing to see what the relation was and it would be almost identical. Like it was scary. So know who you're working with on the manufacturing side. And also I want to urge you to know their business practices. It's important as business owners that we know who we're working with has good business practices that's treating their employees, employees and their staff well and that there's good working conditions. So, you know, I think oftentimes it's really easy to be like, I want to make a T shirt and I just throw a smiley face on it. And I'm going to go, you know, on this platform and I'm going to find a manufacturer. But you really have to go down the long and short of it. I just emailed a friend because she launched, you know, some products, merch, and she has a smiley face. And I was like, I'm so sorry, you have a lawyer for a friend, but you can't actually sell the shirt with the T shirt with the smiley face on it. That's actually something that you have to license. And be careful because Smiley World is very diligent on looking for infringing product because that's how they protect. It's not because they want to ruin a small business. It's because they have to protect what they own and they actually have the responsibility to do so. But, you know, it's not just that, but it also goes one step further into, you know, every money, all the dollars that we spend as consumers, as business owners is, is a boat, you know, to making better working conditions for people. And so I just want everyone to think about the whole vision of it. And as a consumer, I know I want to buy products that, that stand for, you know, good working conditions and sustainable products. And I know it can't always be all of those things, but, you know, just realize that consumers are willing to spend that intentional, conscientious business owner.

Yeah, that's so good. Going back to the topic of smiley and this hits on so many different things, like the Louis Vuitton logos without the lv, but it's just a little like flower star thing. There is this like dirty, I wouldn't call it secret, this dirty misunderstanding we'll call it where people think that if I take a logo and I change it 5% or I change it 20% that it's okay because it's just enough different that it doesn't meet this like minimum expectation. But going back to it's confusingly similar. Does any such 20% rule actually exist? Or where is the boundary of this is just different enough from this licensed or this copyrighted image that it's okay.

So if you're really looking into what we call fair use, there's a doctrine of fair use which is really meant for, you know, people to you know, make kind of plays off of existing work, but it has to be done in a very intentional sense. So I won't dive into all of it. But 20% is really not the rule. The rule is really the intention of use. If the intention is to make it similar enough so you can profit off of somebody else's mark, that's infringement. If your intention is parity, then that may fall under the fair use doctrine and that would be acceptable. But it has to be. People need to be able to readily see the intention. So if it's very easy to see that it was a parody, then that that can be okay. But people parody, people need to really dive into it is not. I want to sell a product that looks like a Louis Vuitton, so I'm going to make it look as similar as possible so that I can profit off of their long standing goodwill.

Buying a roll of Louis Vuitton material on Etsy is infringement, everybody. You heard it here for the 100th time.

Yes. And I want to urge people, like you said, think about it as if it was yours, if it was your hard earned intellectual property, something that you had invested in to create, you had established goodwill in something and then someone else is selling it, you have the responsibility and you would want to advocate and protect that. And so if we are as business owners kind of doing the same thing to each other and I want to urge people to. I know we're using Louis Vuitton as an example, but oftentimes I want to argue that businesses that we think are really big aren't as big as you think. And they may be another female owned business that is trying to make it work with cash flow and has to do what it can to protect itself. And I think sometimes we just forget, we see them online and we forget that there is a business owner.

Lauren, I want to shift a little bit from trademark and talk about another big topic for so many retailers, so many small businesses today. And that is hiring and scaling your business through growing a team. One way we did that some of our very first employees were actually hired as contractors first and then moved into payroll when that became really applicable to them. Talk to me about kind of that process and the difference in hiring a contractor versus having a payroll employee. And really some of the pros and cons. Cons we should be aware of.

Yeah. So I would urge you to think about it like level of control. That is really kind of the. There are so many tests, there are so many factors. It's a very subjective process. But at the heart of it, it's kind of the level of control that you want to have in that relationship, that working relationship. So if you want to be able to dictate when they show up, how they show up, what they do, their day to day activities, that's going to be an employee. If you're hiring somebody because they have expertise in an area and they. And I would argue that they have other clients that they are giving this expertise to. Right. They actually have their own business. They're a consultant. They are a graphic designer. Absolutely. Hire them as a 1099 because they are giving you their expertise. You're hiring them to complete a project. It's really inappropriate to actually hire a contractor. And they're like, oh yeah, they've been on 1099 for the last 10 years. And I tell them their schedule every week. That is really not. That's a misclassification. And I really do believe that as a country, we've started to see a crackdown on misclassification and know that your risk is also that person themselves. When the relationship ends, are they going to make claims that they were improperly misclassified or misclassified would be the better phrase. But actually, you know, I just, I think it's also a level of loyalty. So let's flip it on the sides of what can happen and talk instead about the benefits of having an employee and the level of loyalty that you get from investing from them in a different.

I think that's so good. One more thing I want to add to that, and I'm curious. Your take on this is. And my husband is such a stickler on this because his parents are in the insurance business. But having a contractor also means that that contractor carries a proof of their own liability insurance. So that, that's a big deal. Like, I want you guys to like pause for a second. I'll give you a real world example. Who was this Brendan Burchard? So many people know Brenda Burchard, huge motivational, inspirational person. Right. He lost his first business because he had people working for him as contractors setting up for events. Someone broke their arm and filed this huge claim. There was no insurance to cover it. And he actually had to file bankruptcy because of this whole thing. So when I first heard that story, Eric was elbowing me, like, oh my gosh, like we've been exposed to that risk before. So if you have somebody working for you, they do not have their own insurance. That is a liability that falls back on you. Talk to me more about, like if someone Actually is a real deal contract legally. What do they need to have in place for that to make sense?

Yeah, absolutely. So an independent contractor agreement is going to lay out all the expectations and one of those expectations should be insurance. We see it in almost every single one. What level of insurance do they carry and what situations would they be responsible for? Again, coming back to an indemnity provision, what are you going to indemnify them for? What are they going to indemnify you for? What is the limitation of liability? All things to be looking at because there is a risk in working people with doing business. And you know, on the flip side, if you have employees, you should have a general liability policy to protect you as they come and go, as they work, travel, as they interact. Especially if you have a, you know, any anything. I mean the loss, the theft of inventory, all of those things are very much insurance heavy topics and things that you need to be talking to an insurance broker about. But you can again ask for proof of insurance when you're working with a contractor and be especially, especially you know, tight on it. When you have in person interactions or they might be driving or traveling, those carry more risk than maybe a graphic designer that's you know, working, you know, on a program and sending you deliverables. That's where you may be flexible. But really think about those in person interactions. Travel, driving, those are the most risky things that we do.

Yeah, that is so, so important. What about other just like common mistakes you see in teams growing in businesses hiring employees? Like maybe not having workman's comp in place or just other like HR related legal aspects?

Absolutely. Workers comp so important and insurance so important. Don't think because you have one and not the other that they're not, that they don't work together. Realize how these systems work together. I'm not sure who said it. I think it's like a Warren Buff quote of only insure what you can't afford to lose. When we're talking about employees, that's going to be a lot of it. You're going to want to spend the money. General liability policies honestly are not as expensive as you think. I have a client that is a multi million dollar business with 20 employees and their general liability policy, including their inventory and their status as a manufacturer is less than $3,000 a year. Like let that sink in because I think we always assume it's so expensive so we'll do it when we're making more money. But any business activity, I'm going to say it again, any business activity carries liability even before you've made a dollar. And so I want you to consider that the investment in some of these insurance policies are some of the best things that you can do to round out the actual HR space. Yes. Get the insurance policies. Be very clear. Do your employees travel? What does their work look like so that you're ensuring that you have the proper policies in place? But on the HR side, one of the biggest risks that I'm seeing is people don't do performance reviews. Right. We all want our employees to have the resources and the tools that they need and to feel really good about the company culture and diversity and also want to ensure that they are producing to the standards that is actually going to support the growth of your business. So one of the most common things we see is not executing performance reviews. Arguably, I would like to see people do that once a quarter. I would like you to be doing, you know, satisfaction surveys and not satisfaction surveys in the sense that you're going to drum up dissatisfaction, but getting a pulse on if you're moving to, you know, the culture, trying to create, if they have access to the resources that make them most productive, if their mental health is in a good space, do they have capacity? Do they have room to take on more? Are they a little tapped out right now, and now you're seeing room to grow and hire more, but really not taking for granted, you know, having a real pulse on, you know, how your workforce is feeling. The reason that this is also so beneficial on the legal liability sense is if you have to terminate someone because they are a poor performer, you have a record of incidents that were happening of your attempt to coach them up and really make them more productive, help them improve the resources that you made available to them. Oftentimes, I see people finally call me at their wit's end and they're ready to let somebody go, and I'm like, okay, great. Can you, you know, do you have a few bullet points? I mean, I literally sometimes ask for just a few bullet points, and they're like, yeah, I can come up with something right now. Just remember, it's so much easier to remember things in the moment than it is to have to recall them later. And having a timeline and having it documented in the past is always better, especially when you're coming up against claims of. And I've seen this before, and I really, you know, I really trust the people that we work with, our clients. We've seen discrimination claims. We've seen all kinds of claims that I Believe honestly have no grounding. But it's really hard to then terminate someone for poor performance the moment they've made those claims. Because arguably the biggest liability you're going to have as a business is not, this sounds actually crazy to say, is not the discrimination claim itself. It's going to be retaliation. A business that is seen to retaliate is going to feel is going to have much more liability than just the claim itself. So I would rather you have documented timestamped information in the report performance for the past six months, then have to go back and bullet point it because it's going to look like retaliation. It's going to look like an attempt to drum up a problem so that you can let them go because of something larger. And so honestly, documentation and performance reviews is going to give you a pulse in your team, is going to allow you to document, reduce your overall liability and also reduce your liability for unemployment claims. The moment someone leaves you terminate them because they weren't showing up to work and they go file for unemployment. Not only are you going to be paying someone unemployment and that's going to not feel good because they weren't showing up to work, but on the flip side, it can increase your unemployment taxes which can have an impact on your business for years to come. And that depending on your payroll can really add up. So I want to encourage people, you know, it's not that you're preventing them from benefiting from unemployment. So you need to think about the long term effects of a successful unemployment claim and you know, sometimes unemployment absolutely, you know, just and fine and that's okay. But I want you to think about, you know, how you can protect yourself. And documentation is one of the biggest pieces of that. And investing in, you know, these practices are going to benefit you long term.

I could not echo that enough. I feel like we have walked that walk a lot in our own business in the last year. I would say hire slow fire fast, but only if you have proper documentation that is so absolutely critical. Your team is your greatest asset, but it's also your greatest liability if you do not take those proper steps.

So you are just all language.

I feel like, you know, at the beginning of business you're just like trying to prove your concept. You are just trying to make the thing work. And then once you start to get traction and you're like, holy crap, like I have to keep going in the same direction. But it's only like the legal foundation, the systems, the processes that protecting yourself from these like risks and liabilities, man You've got to pay so much attention to it. So it's becoming increasingly important. Lauren, every day, I swear 100%.

At the end of the day, if anyone takes anything away from this episode is in all things in your business, find a way to document and document advocate.

I love it. Lauren, thank you so much for your time together today. I know there was a lot that we covered but hugely impactful for everybody who was listening. So I really appreciate you. Thank you for sharing your knowledge with us today.

Oh, my gosh. I am just. I'm really thankful to be here. I feel like you just have built such wonderful resources for this industry and. And I really think you're changing the game and you just have such a level of expertise. They're so lucky to have you.

Oh, thank you so much, Lauren. We will link up all of your details in the show notes. You guys can catch that Lauren anytime. But thank you. This was wonderful today. And also be sure to watch Lauren and listen to Lauren on her own podcast. We will link that up in the show notes as well.

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