By now, most people have already broken at least a few of their New Year's resolutions, but the NFIB Small Business Legal Center has come up with a list of five resolutions every small-business owner should keep.
In the next few weeks, small-business owners should:
1. Perform an Insurance Check-Up
It’s a good idea to schedule an insurance physical each year. If it has been a few years since you’ve reviewed your coverage check in with your agent this year. Your business and industry probably has unique needs and risks. So to get the best available coverage and rates, work with an insurance broker who knows your business and has experience in your industry.
Although employee handbooks can be really helpful to employers, having a bad employee handbook can hurt you. Your employee handbook shouldn’t describe policies and procedures that you don’t follow. It is not a place to describe your dreams for how your business ought to work. It is a place to describe the reality of how your business actually operates.
This year pull out your handbook or policies, sit down, and read them. Then update, edit, and delete as recommended by your attorney. Finally, distribute the revised handbook to your employees and have them sign a form acknowledging receipt. Keep the form in your personnel files. (NFIB members can access the Model Employee Handbook for Small Business.)
3. Check Your Corporate Records
Remember that a corporation is good, but only if you use it properly. Many people pay an attorney up to $1,000 to setup a corporation, then take the corporation's minute book and stick it on a shelf. A corporation will not shield you from personal liability if you do not follow corporate procedures. This year make an appointment with your attorney or accountant to review your corporate binder’s contents. Does it contain what you need to prove your business’s corporate status?
4. Institute a Good Document Retention Policy
Have you ever wondered how long you should keep a contract, banking statements and employee records? Or are you keeping every single bill, tax return, insurance invoice, and even the parking ticket that you received ten years ago? If you answered "yes", you are not alone. Many business owners are unsure as to how long they should retain business documents and records. A document retention policy that is followed by your employees will benefit your business by promoting efficiency, saving your company valuable computer and physical storage space, and protecting your company in the event of litigation. Given our culture’s penchant for lawsuits, you want to protect yourself and having documents provides good coverage. But you needn’t keep every piece of paper forever. This year commit to weeding out what you don’t need and organizing what you do need. Check with your attorney or tax professional for guidelines on keeping and tossing.
5. Audit Your Form I-9s
The Form I-9 is the form the federal government uses to hold employers accountable for hiring workers legally eligible to work in the United States. The form should be completed on the first day of employment by ALL employees hired since 1986. Yes, the law applies to your sister-in-law and the kid you grew up with if they are employed by your business. This year ensure that you have completed I-9s for all of your employees and that the forms are correctly filled out. Conducting an audit might take some time and effort depending on the number of employees you have, but will save you headaches and possibly penalties should a federal agent knock at your door.
To learn more, visit the NFIB Small Business Legal Center's website at www.NFIB.com/legal.