Legal Counsel

**Justice44** · 11-07-2008 02:23 PM

There is an article that I would like to share with you. It talks about how to deal with a discrimination lawsuit:

Sued for Discrimination: What to Do When the Unthinkable Occurs09/ 17/ 2004
by Tamara E. Holmes

You may consider yourself to be fair to all of your employees, but the harsh reality is that one or more may not have that same perception. If that is the case, you may one day find your small business the subject of a discrimination lawsuit. But by at least considering what you'd do should the unthinkable occur, you could be better prepared to handle it if it does.

There were 81,293 charges of discrimination made against employers in 2003, according to the Equal Employment Opportunity Commission. Federal laws say it is illegal to discriminate against individuals based on age, sex, race, ethnicity, religion or physical disability. If you use any of these criteria for making hiring, firing, promotion or salary decisions, your company can be sued.

But what happens if you fire one of your employees for failure to do his job efficiently, and he says you really fired him because he is Latino?

Whether ethnicity came into play or not, you must take the charges seriously, immediately.

"As a business owner, you should always be concerned about [discrimination] issues," says Jared K. Ellison, a lawyer who handles discrimination cases for Washington, D.C.-based law firm Temple Law Offices.

When you start having problems with an employee's performance, document those problems on paper so you can justify firing him or her if that's what it comes down to.

The first thing an employee must do if he or she plans to sue is file a charge with the EEOC. The employee has up until either 180 or 300 days after an incident to file the charge, depending upon the state.

As a small-business owner, you might not be subject to federal discrimination laws, depending upon the size of your company. For example, the Civil Rights Act of 1964, which prohibits discrimination based upon race, sex or national origin, only applies to businesses with 15 or more employees. If you're faced with the threat of a suit, check to make sure your business is large enough to be subject to federal laws.

That's not to say that an employee can't file a civil suit against your company, but you'll want to be aware of the areas in which you are at risk.

The EEOC will review the case by first contacting you and giving you a chance to respond to the charges. Then the EEOC will give the employee a chance to respond again, after which the EEOC will decide whether or not it finds that the law has been violated. If it does, it will generally allow you to come up with a mutually agreed-upon resolution or it will file suit along with the plaintiff.

If the EEOC does not find fault with your company, that still does not mean you're out of the woods. Even if the EEOC decides not to take up any discrimination charges against your company, the employee has 90 days to file a suit of his or her own.

Because of the high stakes involved, you should seek an attorney who is familiar with discrimination laws as soon as you're contacted by the EEOC, Ellison says.

"A company cannot represent itself," Ellison says. "[It] must have an attorney."

There are a number of ways to find a trustworthy attorney who specializes in discrimination, he says.

"You can call the different bar associations in that state or you can do your research on martindale.com, which is a legal Web site, or you can ask other attorneys, 'Do you know anybody that handles Title 7 discrimination cases?' and they will usually let you know. Word of mouth is usually the most powerful tool."

Not only will an attorney be able to lead you through the process, which could last a number of years, but he or she may also advise you to settle the case or participate in the EEOC's free mediation program. That program gives employers and employees a chance to come up with a solution outside of litigation.

The bottom line, Ellison says, is that business owners should be proactive when it comes to proving they did not engage in discriminatory practices because losing a discrimination suit is no joke.

"A suit can hurt [business owners] financially where it can actually cripple their business and they may have to end up filing bankruptcy," he says. "It can put a small business out of business."

If you have any comments, you are free to share them.

**Justice44** · 11-07-2008 02:28 PM

This article explains many legal issues for homebased businesses. Some of you may share the same experience or situation. Here's the article:

Starting a Homebased Business Legally

Before you set up shop, make sure you've got all your legal bases covered.

By Judith Silver

In starting a home business, you should consider the legal issues of starting any business as well as your local zoning regulations and any restrictions on the use of your property.

Zoning Regulations

Municipal regulations for your town determine what types of businesses may be run from your home. These vary by town, so you'll want to look up the regulations for your town by visiting the zoning board or local law library, which is usually located near the local courts. When you go, if you speak with zoning board or other officials, be careful not to give out your name or information to them. Just make general inquiries about the regulations, your planned business and your area of town. You don't want to inadvertently create problems by highlighting your home as a spot for investigation. Alternatively, you can have a friend or your attorney find out such information for you.
Generally, the municipal regulations set forth broad terms of permitted uses such as "customary home businesses" or a list of uses such as "professions and domestic occupations and crafts or services" or "law, dentistry, medicine, music lessons, photography, cabinet making" and so on. These regulations are broadly worded to allow for judicial interpretation in a case challenging a use, which comes before a court. Case law for your state would outline the factors that a court would consider in determining whether there is a violation of the local regulations.

Local regulations for home businesses also often restrict:

The number of employees the business can have (often very few at most).
The number of customer and third party (delivery, vendor and so on) visitors and the frequencies of their visits to your home (per hour or per day).
The percentage of your home and which parts of your home (garage, den, shed) you can use for a business.
Signs for the business.
The resulting traffic, noise and parking effects of the business.
You'll want to be careful and aware regarding these matters, as your neighbors are usually the ones to complain to the zoning authorities. In other words, running a business so that your neighbors are unaware is a good way to ensure that the local authorities won't come to your door.

You also want to talk to your accountant or read information from the IRS on the issues of tax deductions regarding home businesses. They are often advantageous but can have restrictions, which may be at odds with the local regulations. So it's a good idea to read up on both before taking any actions in terms of where and how you'll set up the business on your property. Be aware that any claims you make to the IRS or other government agencies about usage of your home and business could end up being used in a later investigation or audit, so be sure to be truthful and consistent in the information you provide.

Private Restrictions on Land Usage

Secondly, you need to consider any private restrictions on how you can use your property. These may be in the form of use covenants on the land, co-op or condominium rules, or lease or rental agreements.

Covenants: Land covenants are legal restrictions on the title or deed to the property that have been formally agreed to, or imposed by law on the property, by yourself or other property owners regarding use of the property. There may be restrictions on business uses of the property. Subdivisions typically have extensive covenants on the property that restrict usage, so if you live in a subdivision, be sure to get a copy of them from your division management.
Rules: Cooperative and condominium living places have governing rules that you agree to when you are given permission to live there. These are often lengthy and contain many restrictions on noise, use of property, activities at different times of day and so on. You'll want to read yours carefully before starting a home business. If you violate them, you can be forced to move out or sell your property.
Leases: Standard apartment and home leases contain restrictions on noise and use to protect the other tenants and neighbors, as well as to ensure the landlord's protection from liability for unusual or unauthorized uses of the property. Thus, be sure to read your lease carefully prior to opening a business, especially how the agreement may be terminated. For example, if you are on a month-to-month lease (vs. a yearly lease), the landlord can evict you (and you can leave) with one month's notice, without reason. If he or she doesn't like the effects of your home business, your landlord might choose to exercise his or her right to evict you.
Other Considerations

Finally, many potential home businesses also require state licenses--such as child care, talent agency, auto repair, private investigation and others. After you've researched your town's regulations on home businesses, be sure to call the Secretary of State and ask about what agency, if any, regulates your planned business and what you need to do to get a license. Often you can also find this information through the Secretary of State website or other state agency website.

Note: The information in this column is provided by the author, not Entrepreneur.com. All answers are general in nature, not legal advice and not warranted or guaranteed. Readers are cautioned not to rely on this information. Because laws change over time and in different jurisdictions, it is imperative that you consult an attorney in your area regarding legal matters and an accountant regarding tax matters.

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Judith A. Silver, Esq., is the CEO and founder of Silver Law Inc., a technology and business law practice, and Coollawyer Inc., a legal publishing company on the Web. Prior to starting her companies, she served as in-house counsel at Adobe Systems and Sabre/Travelocity.com. She holds a bachelor's degree cum laude from Cornell University and her juris doctorate from the University of California, Hastings College of the Law, in San Francisco.