The 3 Benefits of Improving Workplace Safety

By Lisa 4

Workplace safety is important for employees and businesses alike. Without it, chaos takes over and employees tend to trust their employers a whole lot less. Here are three benefits of improving the safety of your workplace.

Improved Employee Morale

The definition of morale, according to the Merriam-Webster Dictionary, is the confidence, enthusiasm, and discipline of a person or group at a particular time. This describes exactly what happens when a company improves the safety of its workplace. Feeling safe in a workplace makes employees bond together and form better relationships with each other. Observe this when your company holds demonstrations or drills for fires, tornadoes, or intruders. Practicing for danger is a great way to boost employee morale. This is due to the fact that the employees can treat the drills as real-life scenarios. In the real case of an emergency happening, people are more prone to help each other stay safe and calm. This simple safety activity builds confidence, enthusiasm, and discipline in workplace relationships.

Improved Organization

Staying safe in the workplace is much more than practicing drills. Many safety improvements help the workplace stay more organized, which in turn improves efficiency and employee productivity. Incorporating safety measures such as fire alarms, security systems, and network safety are all wonderful ways to keep employees safe in their place of work. If employees know that they’re safe while at work, they will more likely work harder, thus benefiting the business. No one wants to worry about if he or she will get out in time if there’s a fire or whether his or her car will be broken into while at work. By taking precautionary measures inside and outside the building, you will make your employees feel much safer and happier while at work.

Less Employee Turnaround

In order for an employee to stay in a job for more than a few months, he or she needs to feel safe and secure in the workplace. Forgoing safety precautions is not only bad for your employees, but it is also bad for business. The higher the number of your employees who leave, the more individuals your business will have to hire. The hiring process takes a considerable amount of resources, time, and effort on the part of the business. The gap in manpower may also negatively affect your business. By incorporating employee safety into your company’s goals, you will effectively encourage your employees to stay in their jobs. As a bonus, you’ll even save money in the long run.  

There really are no good reasons to forgo business safety, and there certainly are no good reasons for boycotting the law. Bringing extra safety precautions into a business not only benefits the employees, but the employer as well. Benefits such as improved employee morale, enhanced organization, and less employee turnaround will work to your business’ advantage.

Need help with an employee dispute? Lum Law has the tools and experience to help.

4 Characteristics of Wildly Successful Startups

By Lisa 0

If you’ve studied successful startups, you might think that what makes a startup take off or remain permanently grounded is just luck–or a fluke. While all startups are unique, and there’s no guaranteeing that one will be a success, there are certain characteristics of startups that help them succeed better. Here we list the characteristics that every successful startup needs to ensure they cover.

Location, Location, Location

Where you place your startup is of great importance. Entrepreneurs should take into account several factors, including the visibility of signage, rent, utilities, and the relative safety of the area. This isn’t just a matter of choosing the right neighborhood in your city. It’s also about choosing the right city. You want to make sure your startup is located in a city that will be conducive to its growth but not so competitive that it’ll be washed out. Even if your startup is based online, you still need to consider practices like choosing shorter domain names and having a worthwhile host.

Business Sense

A startup can really teach you about the ins and outs of running a business. However, while there’s plenty you’ll learn through trial and error, there’s plenty more that needs to be grasped before you open your doors. As a startup founder, you should have a thorough comprehension of basic budgeting, hiring needs, and marketing. Be sure to hire people who have at least some startup experience.

Pacing

The most successful startups didn’t start raking in mountains of cash overnight. They got to reach their impressive heights because of discipline. As much as you might long to be a smash right out of the gate, you need to work your way up the ladder of success. Make a multi-year plan of things you hope to accomplish by certain dates. This will help you know what to strive towards. Then you can follow the steps and check-in with yourself regularly. Remember, consistency is key!

A Strong Legal Foundation

You need to consider what sort of business you want your startup to function as. You could be an S-corp, which lets owners and workers share income easily but caps the number of allowable shareholders at 100. You could be an LLC, which allows business assets to be kept separate from personal ones in the event of financial hardship, but you’ll have to cover self-employment tax. You could be an LLP, which can be more cost-effective but are restricted by some states. You could also be a proprietorship, which gives you singular reins of your organization but which makes you culpable for any marks on the business. This is a decision you shouldn’t make lightly.

When creating a startup, entrepreneurs can get stuck on having the most innovative idea above all else. While that’s certainly important, they shouldn’t forget about basic standards to follow. All of these characteristics are common among successful startups because they are sensible and important when it comes to sustainability.

Before you go anywhere with your startup, you need to make sure that you have all your legal bases covered. Lum Law Group would be happy to answer your questions and help your new business get started!

 

Scheduling a Meeting for Your Startup? 3 Locations to Consider

By Lisa 0

Startups already have it tough without having to worry about where to meet–those coffee house meetings get expensive after a while. Entrepreneurs have enough on their plate, between gathering financial resources and pitching projects, to have to worry about what address to send people for the next meeting. If you have a startup, you understand all of the struggles that are prevalent in the early days of a business, and how much you need a place where you can come up with solutions to your problems quickly with your partners and employees. While you might not yet have an office space to hold your work meetings, there are plenty of places available for meetings. We’ve compiled a list of a few of the best ones below.  

Library

The public library is one of the best places to hold meetings for your startup. First of all, in many public libraries, you can reserve private rooms. Secondly and even more importantly, you have access to lots of information that you can either find in book format in the library or order from another one. You also have access to wi-fi and even computers if you don’t have enough. Another option is a university library, which will give you access to an even larger amount of resources, but a public library will suffice if you don’t have access to a university library. A couple of the few downsides of using a library as your meeting place is that your meeting location might change depending on the other events that the library is holding, and university libraries might have more restrictions on who they allow to use their resources.

Meeting Room

Reserving a meeting room at a conference center is another option. Like a library, you’ll have access to wi-fi, and you might even have access to their computers. This option is also great because they are used to having people use these spaces for the very purpose of holding meetings. A formal meeting room has access to business tools and technology as an added bonus. This option can be less than desirable, however, if you need to pay for it, and it won’t give you the same level of access to information that a library will give you.

Chamber of Commerce

Your local Chamber of Commerce might be a great place to hold a meeting. First of all, if you have a membership, a meeting room should be free. It will have wi-fi, and it also has rooms that are designed for work meetings. But you’ll need to check with your local Chamber of Commerce to find out which rooms are available and if there’s a fee if you aren’t already a member. There are also Chamber of Commerce membership benefits that could make it worth your while to join.
While you have a lot of hurdles to overcome as a new business, there are a lot of resources available. Check out your city, and then make a decision based on your needs.

For all your business law needs, get in contact with Lum Law Group and see how we can help!

How to Plan for These 5 Deadly D's of Business Partnerships

By Lisa 0

Your partnership may be going along smoothly without a worry in sight. However, it’s important that you and your partner talk about what you would do in the case of certain events. Some of the subjects can be difficult to talk about, but it is better that you are prepared for whatever may happen.

Disinterest

No matter how excited you are for your business, you can’t always know how excited your partner is going to be during the long run. There needs to an exit clause within your partnership agreement that allows your partner to leave if they are more interested in other career opportunities. You will need to put in place that your partner will not be financially compensated if they leave due to disinterest.

Divorce

When your partner goes through a divorce, it is going to be difficult to deal with their ex. Since California is a community property state, they will most likely have a stake in your business due to their marriage with their partner. It is important to get a lawyer involved in order to deal with an ex-spouse who wants to take as much as they can get their hands on during a divorce. Even when an ex is just trying to stick it to the one they are divorcing, it is easy for you to get caught in the crossfire.

Source: https://www.mentalhealthamerica.net/separation-and-divorce

Drug Addiction

One thing that will keep any business from flourishing is someone who is addicted to drugs. What often begins as an innocuous use of prescription pain management solution can easily spiral out of control. As conventional substances cease to provide the relief they once did, users begin seeking stronger substances such as fentanyl or heroin. This doesn’t make someone bad, it just means that they need help. It is important to confront your partner when you feel as though they might be sliding down a slippery slope. If they are not willing to get the treatment they need, you may need to push them out of the partnership. There are legal ways that you can do this with the help of an attorney.

Source: https://www.therecoveryvillage.com/fentanyl-addiction/treatment-rehab/

Default

When your partner has financial issues of their own, it could begin to affect you as well. If they are so far behind on their payments that they are defaulting, their creditors could come after your business. This is why it is important to have your business protected by articles of organization. A limited liability partnership will disallow creditors from levying your business income or targeting your business assets. 

Death

The last thing that you will want to talk about with your partner is the potential of death. However, there are times when untimely deaths happen in a partnership. It is crucial to sit down with your partner and an attorney to go over what is going to happen in the event that one partner dies. They need to put in their will what will happen to their stake in the business.

Source: https://justwillsandlegalservices.co.uk/latest-news/happens-business-partner-dies/


While having a partnership comes with certain obstacles, there are still great advantages to starting a business with someone you trust and love working with. Before long, you can have all of the legalities in place that will help you have a partnership in a safe and easy way.

If you need help in establishing a partnership or starting a business, let Lum Law Group help!

3 New Changes for H1-B Filers in 2019

By Jessica Suotmaa 0

Here at Lum Law Group, we have already begun preparing H1-B petitions on behalf of our clients.  If you plan on filing this year, do not wait till mid-March (it might be too late!) Contact our office for answers and assistance on filing your H1-B petition this year!

On January 31, 2019, DHS has issued the  final H1-B ruling. on the anticipated H1-B processing changes.  On January 31, 2019, USCIS published the final H1-B ruling.

1. Having a U.S. Master’s Degree Helps

USCIS’ new “reverse selection order” will apply to the upcoming FY 2020 filing season. If you’re unsure as to what the word “reverse” refers to, here’s how the random visa selection used to work:

  1. Select 65,000 from a pool of advanced degree exempt “regular” bachelor’s degree holders.
  2. Select 20,000 from a pool of master’s degree holders.

Here’s how the current selection will work:

  1. Select 65,000 from a pool that includes both “regular” bachelor’s degree and advanced degree holders.
  2. Select 20,000 from a pool that includes the remaining master’s degree holders.

The selection order reversal will increase the chances of a advanced degree holder to “win” the H1-B lottery by an estimated 16%, and decrease the chances for a bachelor’s degree only employee to be selected.

2. Early Elimination via Pre-registration

The new pre-registration requirement will require the employer (company) petitioning for employees to first register the employee electronically.  The electronic registration will be quick and easy, requiring only basic information such as the employee’s name, citizenship, passport number, job title, and whether the employee has a U.S. master’s degree.

But, it will only be open for a limited period of time, possibly only 14 days (the minimum). During this time, petitioners can delete an inaccurate registration and resubmit, as well as edit a registration prior to submission.

USCIS will then select from pre-registered petitioners. What this means is that many will be rejected at the pre-selection process and not allowed to join the H1-B visa lottery selection.

USCIS states the purpose of pre-registration is to reduce the number of H1-B petitions it receives, screen for duplicates, and to reduce H1-B fraud and not for eligibility purposes. However, the inclusion of a “U.S. Master’s Degree” in the pre-selection process suggests USCIS may prefer U.S. master degree holders over other pre-registrations.

3. H1-B Filing More Affordable

The new rule goes in-depth on the cost analysis of the new implemented changes to H1-b non-immigrant visa processing. The report analyzes both agency savings and petitioner savings.  Where previously petitioners would have to hire someone, either in-house or external, to prepare Foreign Labor Certificate and the entire Form 129 – H1-B Specialty Occupation Worker, the pre-registration would reduce the cost of trying.  A failed pre-registration screening will result in the petitioner saving significant amounts of money in preparation fees and USCIS filing fees.

In addition, many small businesses who did not have the budget to apply for H1-B given it’s high-entrance cost and risk of failure can now more readily join the lottery.

 

Now that we’ve highlighted the three key takeaways from the new H1-B rule, you might wonder about premium processing? On January 28th, 2019, USCIS published a press release stating it will resume premium processing cap H1-B petitions for FY 2019.  Please contact us if you have any questions regarding this issue.

 

mompreneur asks

By Jessica Suotmaa 0

A “Mompreneur”, a mom who is also an entrepreneur, recently asked how she can lock in her business name so that no one else can use it. She is in the early stages of starting her business and isn’t ready to have a sign on the door or even a website.  She had many, many questions regarding her logo, her business name, other business names and logos, which basically came down to how she can create the brand she’s visualized without legal ramifications.

While answering her questions, we realized these may be common questions that start up entrepreneurs and new small business owners ask.  We decided to share both her questions and our answers in this blog for your reference.

Note: Our Mompreneur’s anonymity is fully protected.

Question: I know what my business will be about. I have a name picked out and two design ideas but I wonder:

  1. Does it make a difference that the name I want is used in a different industry? Can I still use it?

  2. One of the designs looks similar to a design used by a foreign company overseas. Can I still use it?

  3. How can I lock in my business name so that no one else can use it?

  4. I’m not ready to have a website yet, but I want to set up my Facebook Business Page. How can I reserve the website name so that others can’t use it?

Answer: It sounds like you are well on your way to starting your business!  Startups require much thought and it’s great that you’ve started on the online branding already.  However, the order in which branding occurs is important for legal purposes.

To properly answer your question on the business name, we would need more details, such as the name you have in mind and the businesses and industries of said businesses that already use your chosen name.  There are many ways to answer this question and to give you an idea of what the different ways might be, here’s what we would typically ask:

  • Have you registered a business entity for your business idea? Do you plan to? Do you plan on using your brand name as the business entity name?

    • You can go on California’s Secretary of State website to look up your chosen business name and see what businesses (if any) have already registered your chosen business name in the State.
    • The State will not allow you to register the same business name as an existing active business entity, even if in different industries.

  • If not, do you plan on registering a trade name or “doing business as” (DBA) fictitious business name?

  • Would you like to trademark your business name?

    • If you really want to protect your brand, then we would recommend trademarking your business name and logo.  Start by searching the trademark database to see if your chosen business name is already in use.
    • You can trademark your desired business name even if another business is already using that name, provided they are in a different industry with dissimilar products/services.
    • You should have begun using your desired trademarks in commerce prior to registering.
    • A trademark will prevent others from using your registered business name, or names and logos that are similar to your registered trademarks. If it does not, then at least you will have legal “weapons” to protect your intellectual property.

Once you have the strategy down for your business, then start searching website domain names and finishing up that Facebook Business Page!

If you need assistance with any of the steps above, a good business attorney specializing in small businesses and startups can help analyze your specific needs and provide insight and help. Contact one of our experienced business attorneys!

 

5 Things to Consider when Choosing a Co-working space

By Jessica Suotmaa 1

We at Lum Law Group know many who have ventured into the modern world and signed up for the modern working space.  Instead of hiring an agent to find a traditional office space, negotiating a one to five year long lease, and waiting months to move in, a co-working space can start you in their offices as soon as your credit card payment is processed.  Still, a newbie entrepreneur or small business owner might wonder, what factors should I consider when choosing between renting a traditional office space and signing up for a co-working space? As such, we have rounded up our thoughts into this listicle for your convenience.

1. Length of Obligation

Traditional office leases require at least a one year commitment with a few months deposit.  This can be a hindrance for an entrepreneur, startup owner, or small business owner who is unsure of how much space is needed at the beginning. You might want to upgrade your facilities after a few months when you hire an extra five employees.  You might need larger co-working spaces for planning and meetings.  Perhaps your employees would prefer more space for leisure activities you didn’t consider before.  There are many reasons why a business owner might realize a larger space is needed, but the traditional office lease does not afford such flexibility without loss of deposit and possible fines.

A co-working space is often associated with a “desk” or couch space in a large warehouse-like open area where freelancers can drift about.  These days, the term “co-working space” is interchangeable with executive suites where a lessee rents an office and shares the remainder of the space.  Where an executive suite contract may require a few months to a year, a co-working space is often on a month-to-month basis with little to no deposit.  The commitment is flexible and you can upgrade from a shared open space to a desk, to a small office, to a large office any time you feel it’s necessary. Decide you don’t like sharing a conference room with other tenants?  Move to your own space! The co-working space allows you to adjust and pivot when you desire.

2. Financial Obligation

As mentioned above, traditional office leases can cost more in desired downtown locations and require a high deposit depending on your personal or business credit rating.  However, a co-working space often requires little to no deposit, and starts at rates of $100 a month, depending on location. Since there is no minimum length to your contract, the financial obligation for a starting business is especially low.

3. Your Business’ Online and Offline Presence

Traditional offices offer businesses exclusivity.  You can have your business name on the street corner, on the first floor, on the list of businesses, on your door, etc.  Some may consider this a requirement for a “legitimate” business.  Most co-working spaces cannot offer this, though some executive suites may be able to put your business name on the front door or waiting area.  If you rent a private office at a co-working space, then you can place your business name on the door (or beside it), but it depends on the company offering the space.

Online Presence can be an issue for executive suites and co-working spaces without suite numbers.  On Google Business, for example, a business name, address, and phone number is associated with a location.  When an executive suite has multiple businesses registered at one location, then it’s possible that when searched online, only one location phone number will show up.

If another business at the same location of yours hires a marketing company and has especially good SEO, then it’s possible your company will be overshadowed by theirs.  Clients may call the first number that pops up and expect to be transferred to you, the way executive suites traditionally work.  In this case, the potential client may struggle to reach your business via phone, and even mail can easily be misdirected.  This is especially true if there are multiple businesses offering the same service, e.g. law offices, CPAs.

 4. Networking Opportunities

When a traditional business owner at a traditional office space wants to network, they have to seek networking opportunities through their friends, acquaintances, and clients.  They often join professional organizations, become board members, or sign up for classes. The traditional business owner has to leave their office in order to network, while the modern business owner networks everywhere.

Co-working spaces offer networking opportunities just by definition of being a “co-working space”.  To the savvy networker, this means you have more opportunities to strike up conversation with other professionals in a variety of industries, thus expanding your network.  Since co-working spaces often offer soft drinks, including coffee and tea, it’s easy to “grab a coffee” with someone who happens to be reaching for coffee when you are.

More importantly, to the business owner who is less savvy at networking, many co-working spaces hold weekly and monthly events.  These events might be industry targeted, they might offer professional education, or become opportunities for you to showcase your experience and skill set.  Many co-working spaces offer these events for free to their members, but charge a fee to outsiders to offset their costs. This means you have opportunities to meet people outside the co-working space.

5. Security and Privacy

A traditional office offers business owners privacy in that they have control over who is on the premises, the hours of operation, and the wireless internet cyber security protocols.  These are factors that are of utmost importance for certain industry professionals.

The large, open-space co-working space doesn’t offer much privacy if you haven’t subscribed to a private office or scheduled a conference room.  This could be important in industries where confidentiality and client privacy are important even if you’re just on the phone or typing an email.  There are co-working spaces that now offer private, sound-proof rooms for solo use.

 

If you’re still on the fence as to whether you should consider a co-working space or a traditional office, contact Lum Law Group to speak to an experienced attorney.

Top 3 Differences Between a Sole Proprietorship and a Single-Member LLC

By Jessica Suotmaa 0

If you’re a one-man (or woman) business, you might wonder whether you should continue operating as a “sole proprietor”, or register as a single-member Limited Liability Company (LLC). Since both business entity types are for a single owner, we will cover the top three items you should consider in deciding between sole proprietorship and single-member LLCs.

1. Costs

Sole Proprietor: The cheapest way to start a business is to “be” the business as the owner of a sole proprietorship.  You could obtain an Employer Identification Number (EIN) for free (for banking, payroll, and tax purposes).  As a sole proprietor,  your name is your business. However, if you want to “do business as” another name, you can obtain a fictitious business name for a fee through your county.  You would not have to register your “company” officially through any channel or pay any maintenance fees.

Single-member LLC: This is not the case with a LLC.  To register an LLC with your local State, you would have to pay registration fees and file Articles of Organization.  Depending on your organization, you will also have to file annual Statements of Information (for a fee). In California, an LLC pays a minimum tax of $800 a year.

2.Taxation

Sole Proprietor: As a sole proprietor you would report your income and losses on your personal tax return with Schedule C and itemize when necessary.

Single-member LLC: Since LLCs are not federally recognized as separate entities, LLCs are taxed as one of the other entities: disregarded single-member LLC (sole proprietorship), partnership (if more than two members), or corporation. As a single-member LLC, you cannot elect to be taxed as a partnership, but you can choose between sole proprietorship and corporate.  To be taxed as a corporation, you would need to file a separate form with the IRS.  If you opt not to do anything, you will default to sole proprietor taxation.  To be taxed as a sole proprietor means you would use one of the Schedules and file with your personal income taxes.

In California, LLCs electing to be taxed as corporations have no annual fees. Whereas, an LLC taxed as a partnership or sole proprietorship will have an “LLC fee” if its income is greater than $250,000.

3.  Liability

Sole Proprietor: Since a sole proprietorship means you are your business, it also follows that your business’ income and debts are also yours.  This simplifies your tax preparation, but it complicates your liability.  If your business goes bankrupt, you go bankrupt. If your business is sued by a customer or employee, you are personally sued in the process.  If your business loses all its assets, you could lose all of your personal assets.  Probably the most significant reason small business owners choose to register an LLC over sole-proprietorship is to protect themselves from full liability.

Single-member LLC: A limited liability company means, quite literally, that is offers limited liability protection to its members.  Each state has different limitations and rights afforded to LLCs, so its important not to just read an article on a generic website or service, but specifically refer to California Corporations Code.

An LLC protects its members from outside liability suits, but it does not protect from internal suits, meaning members can sue each other for e.g., profit losses. However, this protection is not all-inclusive. In some cases such as personal negligence, LLC members can lose their personal assets. In other cases, external creditors can obtain your shares in an LLC, or your share of the profit distribution.

Note: It’s important to note that one of the main differences in operating a sole proprietorship and an LLC is the separation of personal and business funds.  As a sole proprietor, you don’t have to keep close records of your business funds. However, as a member of an LLC, you do need to keep your business funds and expenses separate from your personal funds. If you fail to do so, you may lose your liability protection.

 

If you are unsure as to whether you need an LLC, or if another type of business entity would better suit you, contact an experienced business attorney. You may also want to contact an insurance representative to discuss liability insurance.

5 New 2019 California Employment Laws Every Business Owner Should know

By Jessica Suotmaa 0

California will implement many new regulations in the coming year. As a small business owner, it’s important to remain up-to-date with new legislation so that you can ensure your business is in compliance with State regulations. As employment defense attorneys, we encourage businesses to take preventative action before they’re sued by their employees. Here’s five ways you can avoid an employment related lawsuit in 2019:

1. Is he/she an Independent Contractor or an Employee?

The ABC test for determining whether your independent contractor is truly an independent contractor or actually an employee was already implemented in April this year (2018).  The California Supreme Court ruled on the subject in its decision on Dynamex Operations West, Inc. v. Superior Court. Since then, to determine whether your worker is an independent contractor or employee, you should ask yourself the following:

A – Is the worker free from your control and direction?

B – Does the worker’s performance take place outside your company’s usual scope?

C – Does the worker primarily function in an external, independent business or trade?

The answer to all three questions should be “yes”, if not, you cannot issue a 1099 for their work. This means many existing 1099 workers, such as freelancers and contractors, can no longer be considered independent contractors.  Also, if you are self-employed and using a 1099, you may need to administer the ABC test on yourself.

Read more on Forbes’ An End of an Era? How the ABC test could affect your use of independent contractors

2. Do I have to pay the $11 or $12 state Minimum Wage?

In 2016 California passed a legislation raising the state minimum wage to $11 an hour for those working in small businesses with fewer than 25 employees.  For businesses with more than 25 employees, the minimum wage is $12 an hour.

3. What about agricultural workers has changed?

Employers of agricultural workers with more than 26 workers will see changes in overtime policy.  Where the current law requires agricultural workers to be paid time and a half after ten hours of work in a day, or sixty hours in a week, the new law reduces the threshold.  In 2019, an agricultural worker working over 9.5 hours in a day, or 55 hours in a week, will be entitled to time and a half.

But what if you don’t have 25-26 agricultural employees? What if you have 10? The law does not go into effect for you until 2022.

4. Do I have to accommodate breastfeeding mothers?

Yes, yes you do.  Federal law requires employers to accommodate lactating mothers by providing them time and place to expunge breast milk, but it did not specify what type of room. As a result, many mothers were required to pump in a restroom, or even take their infant into a restroom with them.  New law, called lactation accommodation, requires employers to provide nursing mothers with a private room that does not have a toilet stall.

5. What about the #metoo movement and Workplace Sexual Harassment?

Sexual Harassment training used to only be required of companies with over 50 employees, but starting in 2019, even small businesses with as few as five employees will be required to provide sexual harassment education.  The new law mandates that, within two years, supervisory staff should have a minimum of two hours of sexual harassment training while non-supervisory staff should have one hour of sexual harassment training.

 

 

Source: https://www.northbaybusinessjournal.com/northbay/sonomacounty/8947388-181/california-employment-law-2019

Are you prepared for an ICE RAID?

By Jessica Suotmaa 0

Since the beginning of the year, we’ve seen an increase in ICE employment site raids. Many attorneys discuss what to do when ICE knocks on your door–discussing your rights and responsibility of compliance, but here we’ll be advising the employer.  If you’re small business owner, franchisee, or anyone who employs another person, this is for you.

Why does ICE conduct “raids” and “audits”?

ICE stands for Immigration & Customs Enforcement, which means unless you’re in the import/export business, they are knocking on your door to check for undocumented workers.  An ICE audit requires employers to provide copies of all I-9 forms, which verifies an employee’s employment eligibility, on file with HR.

ICE also arrests employers who grossly break employment laws, and issues fines for employees who are not compliant.

Did you know? An error in record keeping can cost you $224-2,236 per form/employee!

What does I-9 compliance mean?

As an employer, you are required to collect United States Citizenship & Immigration Services (USCIS) I-9 forms from every employee working in the U.S.  The most recent I-9 Employment Eligibility form can be viewed here.

Did you know? 76% of I-9 forms have an error that could result in a fine!

Instructions state you must have the employee fill out the I-9 form first, then within three days of hire examine and verify the employee’s documents. The employee should have provided two forms of identification and have valid employment authorization.

Don’t think the three-day deadline is optional. Employers who are caught with employees whose identifications they failed to verify can be charged for willfully employing illegal aliens.

Backdating forms is also not an option–it is illegal. Falsifying documents is one of the worst crimes a small business owner can commit. In 2015, a small California-based manufacturing company was fined $12,000 for two things: 1. Failure to maintain valid I-9 forms for 18 of its employees. 2. Backdating I-9 forms after receiving an audit notice.  Don’t be like Liberty Packaging Inc.

Once you’ve obtained executed I-9 forms and have verified the IDs, then you must keep the forms for three years from the employee’s first day of employment, or one year after the employee’s last day of employment.

I’m just a small business owner–they won’t audit me

Many of us might think only large companies are audited, but this is not the case. In 2014, ICE conducted 1,320 work site audits, of which fifty percent had under 100 employees (“small” businesses).  Your business might not be on the radar, but if even one employee has an outstanding warrant of arrest, then all of your employees will be inspected onsite.

What do I do if ICE is outside?

  • Ask for identification. Get a business card or take a picture of it with your cellphone.
  • Ask if they have a warrant.
  • Check that the warrant is signed by a judge.
  • Make a copy of the warrant.
  • Give them your lawyer’s business card.
  • Be polite and ssk them how you can help them.
  • Do not be defensive or uncooperative.
  • Ask if they will accept copies instead of originals. If they refuse, then ask that you be allowed to make copies before originals are taken offsite.
  • Ask for an inventory of everything they’ve seized, if relevant.
  • Call your attorney.

Know that you only have to let ICE into private premises if they have a signed warrant to inspect premises. Otherwise ICE can only enter places of business.

Regardless of your circumstances, we do not recommend you to hand over any I-9s without consulting an immigration or employment attorney familiar with I-9s and ICE audits.  Contact our office if you need to speak to an attorney now.

What if I receive a notice of an administrative audit?

If ICE has a warrant for your company’s I-9 forms, you have 72 hours to produce the forms.  We do not recommend you to rush to your HR and produce them immediately. Rather, schedule a date and time for the I-9s to be picked up.  Be sure to make a copy of everything you submit to USCIS or ICE and maintain records of all interactions.

If you have several locations, or your HR is not on site, or you just don’t think you can make the 72 hour deadline, then explain your circumstances and ask for an extension. ICE will normally grant you a short extension.

Finally, if ICE determines you have formative errors in your documents, it will give you 10 days to correct them. If ICE determines you have substantive errors in your documents, it will issue you a notice of a fine or otherwise. If you passed your audit, you will receive a clearance notice.

What can I do to prepare for an audit or raid?

If ICE is outside your door, it’s already a little late. It’s also a little late to start panicking when you receive an audit notice in the mail.  The key is to prepare before a potential audit. Here’s what you can do to ensure your business is ready for an I-9 audit or ICE raid:

  • Take out all your existing I-9 forms and keep them in a separate file
  • Ensure all employees have filled out an I-9 form in its entirety
    • If upon review you discover an employee has not filled out the I-9 at all, then have them fill it out immediately and use the current date. Do not back date.
    • Ensure non-citizen employees fill out either their Alien registration number of I-94 number.
  • Ensure you have filled in Part 2 of the I-9 form in its entirety
    • Fill in any blank spaces with a different colored pen and date accordingly.
  • Fix any errors immediately.
    • Correct and notate the correction using a different colored pen and having the person filling it out initial on the side with a current date.
    • If the error cannot be corrected, fill out a new form and attach a memo as to why a new form was necessary.
  • Shred any I-9 forms you no longer need to keep (3 years, 1 year rule)
  • Keep track of any employees who have Employment Authorization Cards (work permits)
  • Ask HR to keep a schedule of EAD expiration dates and promptly remind employees of the deadlines
  • Ensure you are equipped to produce anything ICE may ask you for, including:
    • List of current employees (not independent contractors)
    • List of recently terminated employees
    • Quarterly wage and hour reports
    • Payroll records
    • E-verify confirmations (if relevant)
    • Business information, including business owner’s social security number
  • Designate someone who will be in charge of monitoring the ICE investigation, keeping records, and notifying your attorney.
  • Have employee rights information available and pass out to all employees.

If you have further questions regarding an ICE raid or administrative audit, contact our office and speak with an attorney.

How to Handle an Immigration Employer Site Visit

By Jessica Suotmaa 0

If you’re an employer with employment-based petition(s), such as the Form 129 Petition, for your employees, you might find yourself face-to-face with audit officers from the Fraud Detection and National Security (FDNS) department.  FDNS, or a third-party inspector, conducts site visits on behalf of United States Citizenship & Immigration Services (USCIS) to combat L-1 and H1-B fraud, among others.

Often, the visit begins with a phone call to verify the company’s information.  If you have suspicions regarding an upcoming visit, or you receive advanced notification (rare), do contact your legal counsel immediately.

An Inspector Calls

When an inspector shows up and states they’re visiting regarding an employment-based application, always ask for identification. Note the inspector/officer’s name or ask them for a business card. If you have legal counsel, call them and inform them of the situation. Any interview or discussion with the inspector can take place with your counsel present, or present on the line (conference call/speaker phone).

The site visits can take place at any time of day, during business hours. Typically, the visit will last from 15 minutes to 1 hour. The best way you can be prepared for a site visit is to ensure your front desk personnel are aware of the possibility of an immigration inspection.  Your front desk staff should be well-trained and know how to answer the phone, who works in which department, what each person’s title is, and who to contact if an immigration inspector calls.

Inspecting the Business

During a site inspection, you may be asked the following:

  • to procure documents for review
  • to speak with the inspector
  • to speak with whomever signed the petition (if not you)
  • to allow your employee (beneficiary) be interviewed
  • to give a tour of the office
  • to show the inspector the beneficiary’s workstation/office

New office L-1 petitions should be especially careful as to whether they’re current office, employee, or job requirements meet the hopeful specifications in their initial applications.  FDNS often inspects L-1 petitioners with new offices due to their lacking business plans, confusing organizational structures, or managers who wear too many hats (in other words, beware startups!) Inspectors will pay close attention to whether your employee is performing the work described in your petition, possibly asking multiple people to describe their job title and responsibilities for possible discrepancies.

Inspecting the Employee

The beneficiary of the employment-petition (your employee) should be able to answer all questions relating to his or her application truthfully. In other words, he or she should know what was inputted, and be able to repeat the facts correctly. The inspector will ask for a description of the employee’s…

  • day-to-day job duties
  • academic and employment qualifications
  • terms of employment
  • working hours and total work week
  • compensation and pay dates
  • manager’s information
  • the names and titles of people with whom the employee collaborates
  • the details of recent work appraisals.

In addition, the employee should have on hand the following:

  • valid identification documents
  • business card for your company
  • recent pay stubs
  • copy of LCA
  • latest Form W-2

If for some reason you do not have adequate information on hand, you can request an extension, or a second meeting with the inspector.  This would be appropriate if a certain staff member handling the affairs is not present, such as your immigration person, the HR manager, or in-house counsel.  If you do not have the requested documents and need more time to produce them, you can ask for an extension, a follow-up visit, or for USCIS to issue a Request for Evidence (RFE).

The Inspector’s Verdict

While you may try reading the inspector’s expression as they exit the door, keep in mind it’s not a guarantee of the result. The inspector will not tell you onsite whether you have “passed” the inspection. The only way you’ll find out if the inspector found your credible, and your petition valid, is via the mail you receive from USCIS.

If the site visit was to the inspector’s satisfaction, then the petition will be approved. If the inspection was not satisfactory, USCIS can issue an RFE for additional evidence, deny the petition, or even rescind a prior approval (often in the case of L-1 extensions, especially if the initial L-1 was a blanket approval).

 

If you’re expecting a site visit, interested in extending an existing L-1 visa, or petitioning for a new one, please contact one of our experienced attorneys for a qualified answer.

How to Protect Your Business From Common Lawsuits

By Lisa 0

As an entrepreneur, it’s your responsibility to make sure that the business runs smoothly and is not affected by anything. One thing that can greatly harm your business is a lawsuit for tort liability. To avoid being a victim, here are five ways to protect your business from common lawsuits:

1. Monitor Your Actions and Words

You should be very careful when making public announcements or launching marketing campaigns. Always be honest with your promotions and avoid misleading advertisements. In addition, public statements should be respectful and avoid slander.

2. Institute a Sexual Harassment Policy

In your company’s sexual harassment policy, define what sexual harassment is, state that your business won’t tolerate such practices, talk about how your firm will discipline wrongdoers, include a procedure for filing such complaints, and outline protective measures for those who report such conduct. Gender shouldn’t be a basis for discrimination or irresponsible behavior; therefore, train your employees to treat each other with respect.

3. Have Personal Liability Insurance

Take up personal liability insurance to protect your personal assets from personal injury claims. You never know when an employee may decide to sue you for damages. For example, an employee can get injured at work due to their negligence, but choose to sue you for the accident. If you’re still in the process of building your commercial property, then take steps now to ensure that your construction company follows regulatory requirements for the structure. This will ensure that your property is up to code in terms of health and safety. Some additional precautions that you can take to avoid such a scenario are to section off dangerous areas and to install safety signs in places with heavy machinery. Ultimately, your business carries the duty to prevent personal injury for both the customers and employees on your premise.

4. Keep Your Files Safe

In the cloud computing era, it’s perfectly normal for your business to store information on the cloud since it minimizes costs and guarantees operational efficiency. However, before you select a storage system, ensure it’s safe to prevent the theft or misplacement of your client’s personal data and files. A customer can sue you for data breach and win if he or she discovers that you lost their personal information or it fell into the wrong hands.

5. Maintain Separate Accounts

You should not mix your business and personal accounts. An employee or an interested outside party can easily sue you for misappropriation of business funds if they discover that your accounts are not separated. Even if you don’t misuse company funds, it may be hard to support your claim due to constant withdrawals from your personal account.

Wrapping Up

Try incorporating the above strategies into your business operations to minimize costly lawsuits. Additionally, have a well-defined code of conduct in an employee manual to ensure employees know how to conduct themselves while at work. 

For more information on how you can secure your business against common lawsuits, or if you have any questions on how to handle a lawsuit that’s been brought against you, contact us now. At Lum Law Group we help our clients form and protect the businesses they’ve built from the ground up.

What You Need to Know Before Expanding Your Business Overseas

By Lisa 2

Expanding your business overseas is an exciting development for entrepreneurs. Developing economies are the new frontier, and only the industrious can hope to take advantage of it. Of course, where there are unique opportunities, there are also unique challenges. Expanding your business abroad comes with several legal concerns that can be critical. When considering expanding your business abroad, here are a few important points for you to consider.

The Business of Exporting

Expanding your business gradually is often the best practice. One of the simplest ways to enter an international market is by exporting goods.  Compared to opening a business locally, exporting will allow you to tap into the international market while avoiding heavy taxation, depending on the market and product. Generally, your business will only have to pay nominal customs fees.

As your engagement overseas intensifies, you might decide that it’s time to hire distributors. You’ll need to be familiar with local laws, especially regarding taxation.  Before you hire distributors or localize your operations with a branch office, consider hiring a consultant.  A  local business consultant will have specialized knowledge of applicable laws and regulations. A thorough understanding of these issues can help business leaders avoid costly mistakes.

Related: Entrepreneur.com

Patents and Property Rights

U.S. patents and intellectual property laws only protect businesses within the United States. Although European countries have a history of respecting US intellectual property registrations, the same does not apply to many countries in Asia and Eastern Europe.  There are international and local intellectual property organizations with which you can register your intellectual property.  It’s up to business leaders to protect their intellectual property when expanding to new markets. 

Contracts

Contracts in the United States work according to common law derived from judicial precedent. Whereas, contracts in several countries abroad operate according to civil law. Learn the difference and understand how it affects your agreements. How are commercial agreements made and disputed? What are the relevant regulations? What kind of records are you required to keep? These are all vital market-specific questions to which you should have the answers before you set sail.

Related: ACC.com

Learning About the Marketplace

Successful entrepreneurs know how important it is to understand the market if they want to be successful in their enterprise. A product or service that is popular and well-received in one market may be offensive and destined for failure in another. Have customers who are engaged with your customer services agents helps learn more about the culture and the market. Reading reviews and communicating with customers is another way.

Related: Podium.com

Culture Matters

It’s easy to take the cultural causes of previous successes for granted. Even what is considered a common greeting in one country can be thought of as deeply offensive in another. Rely on relevant experts and local market experts to avoid a misstep that will leave a poor impression. Remember that although you may be an expert in your industry and market, it doesn’t always lend itself to new markets.

Determine whether competing products or limitations in related technologies will be a challenge to your success. Target markets that will facilitate future expansion. Hong Kong and Singapore, for example, are excellent places to start because of their financial and business footholds in the world, and their location to many other economic and global powers. Think of a new market as a hub which will grant you access to increasingly distant opportunities.

Related: E-Sandhurst.com

The Logistics of Doing Business Abroad

Make sure you can scale your business appropriately. Early success has been disastrous to many businesses which were not prepared for a sudden explosion in demand. Expect to grow slowly, but be prepared for rapid expansion by developing a business plan and the resources to scale in advance. Understand the organizational patterns which are common to businesses in the markets you wish to explore and don’t take for granted that they work the way you’d expect. 

Making Connections

Part of the benefit of doing business abroad is learning about new cultures and people. Getting to know the entrepreneurs in a market can be rewarding both for you personally and as a business strategy. By forming contacts with local business leaders in transportation, supply or other related enterprises, you can help bridge the gap between theoretical and practical knowledge. This can become the positive difference in your business’ success. Always enter business relationship with an optimistic view–after all, those local  contacts can also become critical in navigating through any potential legal pitfalls that might entangle the unwary.

Related: Mashable.com

Franchising Overseas Should Be Done Very Carefully

For businesses that are a franchise, the prospect of expanding overseas especially since successful franchises often get the attention of investors across the world. But don’t jump into an offer too quickly, you need to stick to your core model, while being as adaptable as needed. And there needs to be caution as well, as things you might have originally have had down pat – such as franchise royalty fees – may be up to debate in other countries. Just do research as you need, and take it slow.

Related: FranchiseGator.com

Fortune Favors the Well Considered

Moving into the international marketplace is a big jump, even for big companies. Make sure you consult the relevant experts to ensure the process goes as smoothly as possible. Being well-informed is the first step to being well-prepared for success.

Have questions about expanding your business abroad? Or did you have questions about how your patents or trademarks will hold up in the international market?  Contact our office and speak directly to an experienced attorney!

Is a franchise contract for you?

By Lisa 0

When looking into starting a business, you may consider franchising. Buying a franchise means buying the rights to a particular company and own a “satellite location”, a smaller business at a separate location.

As a franchise owner, you could be in the position to run a well-known business with the help and support of the parent company. Companies offering franchising opportunities include, but are not limited, McDonalds, Subway, and School of Rock. 

Before buying into a franchise business, you must do your homework. Do look into the type of business , the industry, franchise prices, market saturation, financing options, and new worth requirements. By considering these items, you will have a better idea of what franchising involves and whether it is a good fit for you.

Legal Definitions

The franchising industry is one of the fastest growing industries across all business sectors. Legally, a franchise is the right an entity has to operate a store or sell products or services under the franchise agreement. In other words, a franchise is where a person has the right to offer specific products and services from a larger parent company.

Another definition of a business franchise is a business agreement where a trader allows another to use their business expertise. They are also allowed to use the goodwill of the business and share its intellectual property in return for fees and commissions or a flat rate.

The legal implications and documents of a franchise differ depending on its type. If you want to “buy into” a franchise, you will pay the usual start-up costs. You can 

In all cases, the franchise does not have to possess as many business skills and expertise as a first-time startup entrepreneur.

How It Works

The way in which a franchise works is straightforward. A person agrees to operate an established business in exchange for an upfront payment as well as any subsequent fees or royalties.

In a typical scenario, a particular company will offer a product or service and a business owner will agree to buy the rights of this company to operate as a business. The business owner uses the business name as well as offering the products and services to the public.

During the duration of ownership of the business rights, the person who bought the franchise will need to pay certain fees or royalties on an ongoing basis in exchange for the naming rights, training, and support.

In many franchises, the franchise will have the advantage of having ongoing training and support. This will allow them to get any help they need in terms of starting up the business and operating it.

At times, the franchise may need to attend regular meetings at the franchiser headquarters to get updates on new policies and requirements.

Should You Get Involved

A franchise is not for everyone. Having said that, there are circumstances when you would benefit from owning a franchise.

If you want to own your own business, selling a certain type of products or providing a certain type of service, you may benefit from franchise ownership. Buying a franchise will allow you to have a more credible, recognizable name, saving you from branding and marketing efforts of your own.  The reputable name of the franchise will help attract customers for the small business owner. Though it doesn’t mean you can let up on marketing and public relation efforts. Google reviews increase trust and reliability, but only positive ones. This means you still need to keep an eye on any negative reviews, even though you might own a franchise. People, regardless of where they are going, are going to trust reviews from verified strangers as they would for friends and family.

While many think of the restaurant industry with franchise businesses, franchising lends itself well to the service industry as well.  Instead of a carpet cleaning professional running an independent operation, they will be better off with a franchise. Other professionals such as accountants may also benefit from using a franchise, such as Liberty Tax Service, instead of operating their own firm. The reason is that professionals providing professional services have a skill or talent to focus on, and many would rather not think about learning entrepreneurship, business, and marketing.  For such individuals, a franchise will provide the training, materials, and support to meet their individual needs. However, keep in mind that sometimes success and franchise decision-making all depends on timing. See how the market is and how well your business is standing on your own before jumping in blind.

Starting a business can be a very exciting experience for anyone seeking financial independence. When looking to start up a business with limited experience, buying a franchise is helpful.  If you have questions on how franchising might affect your business, franchise contracts, or the intellectual property costs associated with some franchise contracts, please do reach out! We’d love to help clear things up for you.

5 Challenges Los Angeles Businesses Face

By Lisa 0

Every business faces many different social and financial challenges. But it is larger cities with millions of people, such as Los Angeles,  that pose the greatest challenges to businesses. Here are five common challenges with any business striving to make it in Los Angeles. 

1. Multiculturalism

Diversity and multiculturalism are considered to be positive assets in American culture. Los Angeles is one of the most ethnically and culturally diverse cities in the U.S. Even so, there are many problems are associated with multiculturalism.

Racism and discrimination are two of the biggest problems that affect businesses. There’s also the problem of language barriers between native English speakers and immigrants without strong English skills. A good number of companies solve this problem by hiring bilingual employees who can cater to both groups. 

2. Overcrowding

Los Angeles is notorious for its large amounts of traffic. With millions of people traveling on the road, it’s easy for an accident to occur and cause major delays. Technology may have many advantages, but it’s actually leading to an increase in auto accidents since drivers tend to be distracted by their phones and other devices. For businesses, problems may arise when a city is overcrowded with residents and tourists.

Having a large population is beneficial to businesses because there are many potential customers. On the other hand, more customers mean more competitors, requiring entrepreneurs to outsmart each other in order to remain in business. 

3. Pollution

Pollution seems like the least of any busy professional’s worries, but it could be a bigger problem in the future. Los Angeles city’s smog seems harmless in the air, but it can combine with moisture to pollute the ground. The government may require businesses to invest more in green energy or eco-friendly products. Think of the new plastic straw ban and the plastic bag ban. These bans were instituted because low-value plastics often end up in landfills or in the environment rather than being recycled.

4. Crime

Crime is a well-known side of Los Angeles that will never disappear. Every week, there are new thefts or assaults that occur on the streets and inside people’s homes. L.A. business owners have to deal with thefts, burglaries and armed robberies, and if they cannot, they must close down. Small businesses cannot simply rely on locks on the doors, but need to have high-security systems installed in order to protect their assets, employees, and customers.

5. Earthquakes

In California, earthquakes are common occurrences. Californians learn to deal with earthquakes and its aftermaths. Earthquake insurance is made for businesses that need to cover property damages. In addition, workers’ compensation insurance covers employee injuries, and auto insurance covers the damages to company vehicles.

Doing business anywhere is a challenge. In L.A., there are more people and more competitors around. Overall, it’s important for business owners to know the types of challenges that your business has before finding the solutions. In that respect, Lum Law is on your side. We are practiced attorneys with specializations in business law; if a challenge ever arises that you’re not sure you can face alone, turn to Lum Law Group!

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5 Things Startups Need to Know About OSHA

By Lisa 0

Every business should be concerned about employee safety, whether you are part of a large organization or a fairly small one, including startups. And even offices have occupational hazards, so don’t be lulled into thinking that only jobs involving physical labor need to be aware of OSHA regulations. If you’re part of a business, then you need to know and be able to implement workplace safety. To help you better understand OSHA, here are five things that businesses should know.

1. What is OSHA?

OSHA stands for Occupational Safety and Health Administration, and is under the United States Department of Labor. The OSH Act was created to ensure the safety of employees while they are at work. OSHA is a government agency that regulates workplace safety practices, ensuring that all employees have a safe place to work.

2. What and Who is Covered Under OSHA?

According to the OSH Act, employers are required to provide a safe work environment that is free of known hazards. This covers all potential hazards such as dangers from chemicals, trips and falls, workplace violence, and almost all other potential workplace hazards. One of the few exceptions to this is any hazards that involve food with workplaces that sell it. Private sector businesses are required to be in compliance with OSHA regulations, but self-employed individuals who do not have employees are not. It is critical that if you are thinking about starting a business or have already started a business that you comply by the OSHA rules and regulations.

3. What Services Does OSHA Offer?

OSHA offers training, education, and outreach programs for businesses. These services are designed to equip businesses and their employees with necessary knowledge in order to work safely. Among these opportunities are classes and grants to help non-profit organizations become more knowledgeable about workplace hazards and how they can be avoided and minimized.

4. How Are OSHA Regulations Enforced?

One of the ways that OSHA regulations are enforced is through inspections. These are conducted without advance notice, and businesses with higher incident rates or worker complaints are more likely to be inspected. Businesses that have had catastrophes and fatalities are most likely to undergo OSHA inspections.

5. Do Injuries and Illnesses Need to be Reported?

As of January 2017, organizations are required to report injuries and illnesses electronically. Many of these injuries and illnesses are ones that were already required to be recorded on-site.

 

Employee safety is a concern for all businesses, both large and small, including startups. Those who are seeking further clarification can visit the OSHA website, which explains the mission and recent changes more thoroughly.

 

Resources:

About | OSHA.gov

How OSHA Rules Apply to Startups | NBC Chicago

Personal Injury Case Law | Craigswapp.com

Why Is OSHA Important in a Company? | Chron.com

 

5 Game-Changing Business Tips For Entrepreneurial Immigrants | Lum Law Group

 

How To Spot A Pyramid Scheme From An MLM

By Lisa 0

Numerous opportunities are available for entrepreneurial individuals who are interested in making some extra money. Unfortunately, it can be all too easy to fall into too-good-to-be-true traps that could actually end up costing you money, or even your freedom (if they’re illegal).  Understanding the differences between a pyramid scheme and multi-level-marketing (MLM) can help you make informed decisions while avoiding the dangers of illegal money-making schemes.

Pyramid Schemes vs. Multi-level Marketing

One of the first things to understand about the differences between pyramid schemes and multi-level marketing is that pyramid schemes typically require individuals to purchase massive amounts of inventory to become involved in the business opportunity. Individuals entering this type of business may also be encouraged to purchase other items or services they do not need or want to stay involved with the company. Additionally, your income is usually not based on your sales of products but rather the number of people you recruit.

Take the time to conduct some research before you consider joining any new business venture. Due to the illegal nature of pyramid schemes, these types of businesses usually close down after they’ve turned a profit. Therefore, the companies aren’t usually in business for very long. By researching when the company was founded, and the history of the company, you can better decide whether the company is offering a genuine opportunity or not.

Compensation

It’s also important to investigate the structure of the company. Multi-level marketing companies can sometimes appear similar in structure to pyramid schemes; however, the key difference between the two is often in the compensation. While pyramid schemes are often based on contributions of incoming members, MLMs earn profits from their sales. It’s not uncommon for a pyramid scheme to only give a broad overview of the amount of money you would make at the lowest level. Instead, they tend to focus on what you can make at the higher levels. If you are suspicious, do not hesitate to ask for more concrete details regarding the average earnings of entry-level members.

Refunds

You should also get details regarding the company’s refund policy. Pyramid schemes usually do not have verifiable refund policies. In fact, you will usually find a no returns policy in the fine print of the contract.

Whether you are in the market to make some extra money on the side or you are looking for a legitimate work-at-home business, it’s important to ask important questions to ensure you do not become involved in a scam. If you think you may be the target of a pyramid scheme or some other type of illegal business practices, contact our attorneys today.

 

Sources

Investopedia

ASEA Scam

Better Business Bureau

5 Game-Changing Business Tips for Entrepreneurial Immigrants

By Lisa 0

In the U.S., you have already seen plenty of active businesses everywhere. What you may not notice is that many companies fail and are replaced on a regular basis. Entrepreneurial immigrants frequently do very, very well in business-friendly locations, but they aren’t immune to harsh market forces either. Here are five essential tips for immigrants who want to start a business in a new country.

Learn the Customs

Personal hobbies and interests are different in every country. Some countries promote spending time with family, while others support more self-centered independence. Learn more about Americans to create products and services that they will need and want.

Learn the Laws

American business owners have many rules to follow if they want to remain in business. They need to obtain and renew licenses, follow safety regulations from the OSHA or FDA, and pay their taxes every year. If you’ve worked in another country, you may find hundreds of additional rules to learn and follow.

Other rules pertain to the specific type of industry. Construction workers are required to wear protective clothing, while medical professionals need certain immunizations. For every rule, also learn about the penalties, such as fines or imprisonment, for not complying.

Improve Communications

Communication is the most important field to study in business. You cannot find customers if you cannot communicate with them effectively through advertising. Furthermore, as Franchise Gator advises, you will be unable to understand the important business paperwork that you will need to read and file.The first step is to read, write, and speak better English.

There are classes for people learning English as a second language along with online learning software. Wordcounter.io includes free grammar tools that will help your written communications sound like native English. Correct all spelling and grammar errors before you advertise to customers.

Focus on Marketing

Getting in contact with customers is one of your most important tasks as a business owner. Work with American marketing professionals from the beginning. They already understand the culture, and can offer advice on everything from creating websites to building SEO content.

Get Help

There are several small business loans available specifically for entrepreneurial immigrants through the US Small Business Administration — which might be one of the reasons why 48% of overall growth of US business ownership between 2000 to 2013 was attributed to immigrant business owners, and the number of self-employed immigrants more than doubled between 1994 and 2015.

If you find yourself having difficulty securing a loan due to low collateral or other challenges, signing a “comfort agreement” may be helpful. This is an additional contract between the borrower and the lender that provides the lender with wiggle-room or recourse in the case you default on your loan.

 

You may have the money and resources, but if you don’t have basic knowledge about doing business in America, you won’t succeed. Come up with a plan on how you will gain this knowledge. Then, learn the tips that are proven to help countless entrepreneurial immigrants.

 

Is your EB-5 Investment a SCAM?

By Lum Law Group 1

The U.S. EB-5 Immigrant Investment Program offers foreign investors and entrepreneurs permanent residence (a green card) in exchange for an investment of $1 million (or $500,000 for targeted employment areas) and job creation.  Over the years, EB-5 investment has virtually guaranteed its investors citizenship, even if it cannot guarantee a return on its high-risk investment.  However, recent years have revealed that many EB-5 marketing agencies, EB-5 regional centers, and EB-5 projects were nothing but utopian pyramid and ponzi schemes.

If you didn’t know about the warning…

Every year, the US releases 10,000 visas to EB-5 immigrant investors, but it wasn’t till 2013 that all 10,000 visas were claimed.  Since then, the government has released an official warning to investors regarding the prevalence of EB-5 fraud.  In the warning, the US Securities & Exchange Commission (SEC) reveals a few warning signs investors should steer clear of:

  • guarantees of a visa, green card, or citizenship
  • guarantees of a return on investment (5% in SEC v. Marco A. Ramirez, et al.)
  • promises of “no risk” investment
  • proof of overly consistent returns on investment
  • agencies that promote a business before USCIS has designated it as a Regional Center
  • promises to refund Regional Center administrative fees if the EB-5 visas are denied (SEC v. A Chicago Convention Center, et al.)
  • unregistered investments
  • unlicensed sellers
  • many companies run by a handful of people

If you’re curious about past cases of fraud…

Other well-known EB-5 fraud cases include:

  • USA v. Jennifer Yang, Daniel Wu – Californian (norcal) couple raised $4 million between 2009 and 2016 through the EB-5 visa program by defrauding the gov’t with fake reports, fake employees, etc.
  • Edward Chen, Jean Chen – Californian Chinese-American couple raised $22.5 million through Chinese EB-5 investors and stole more than $12 million, misappropriating more than 91 percent of the investors’ funds, and defrauding the gov’t by issuing leases with fake information.
  • Victoria Chan, California Investment Immigration Fund –  South El Monte-based father-daughter duo raised over $50 million from Chinese investors by submitting over 130 fraudulent EB-5 applications.
  • Jay Peak, Inc. – A ski resort company raised $360 million between 2006 and 2016 for various construction projects that were not realized.
  • Xin “Lisa” Wang, Charles C. Liu – Raised $27 million to build a proton-beam cancer treatment center, but 18 months later it was discovered the funds had just been divided among the agents (Los Angeles, 2016).
  • Emilio Francisco, PDC Capital – Californian (OC) Attorney collected $72 million from investors to fund various projects from coffee shops to assisted living facilities only to divert at least $9.6 million for his personal use.
  • Steve Qi – Alhambra-based attorney sued for pocketing money from both investors and regional centers while fraudulently promoting EB-5 projects based on personal gain.
  • Anshoo Sethi, A Chicago Convention Center LLC – Chicago-based attorney raised over $158 million through over 290 Chinese investors for a hotel project that never took off.

If you’re looking to invest…

The SEC also offers helpful tips as to how to avoid EB-5 fraud:

  • Confirm a Regional Center is on the official list
  • Ask the Regional Center for official USCIS documents, such as the form I-924, and I-924A
  • Ask for a copy of the written investment memorandum
  • Ask if the agents/promoters are being paid
  • Hire a third-party to verify the investment
  • Weight the risk by reviewing the loan documents
  • Confirm if the developers have also invested in the project
  • Confirm a regional center can operate in your geographic location

If you’re worried…

If you have reason to believe an EB-5 investment project is a scam, or a Regional Center, agent, or seller is suspicious, you can report their activities to the SEC here. The SEC typically offers a monetary award to successful whistle-blowers. Scams can also be reported through Immigration (USCIS) or the Federal Trade Commission (FTC).

If you’ve already invested…

The attorneys at Lum Law Group has experienced business litigators with traditional EB-5 and class-action law suit experience.  If you believe your investment qualifies as EB-5 fraud, we can help you. In the end, EB-5 is nothing more than a business contract.

How to Improve Focus and Superpower Your Startup

By Lisa 0

If you have a startup, then you know how much work it takes to make it successful. With so much competition today, you need to have strong strategies at work to win and compete. Focus is key in this adventure to grow your company. Here are some tips to stay on top of your game:

 

Marketing

No startup can succeed without focus in the marketing department. The best way to get this is to set specific goals as to what you are looking to achieve. If you have the best marketing in the world but no solid game to capitalize off of it, you could be in for a world of hurt. Make sure that you are bringing your team in regularly to review your goals and that your marketing is accomplishing what you need it to.

 

Hiring

Let's shake on business

If you want to have focus and superpower status in your business, your talent is going to be very important. Without the right team to bring your goals to the forefront, you risk not having the competitive edge your deserve.

 

Schedules

If you have no schedule, it is easy to let focus get away from you and not have the results that your startup needs. If you don’t have specific meeting times, creative time, and rest time, then you might spin out of control.

 

Smart Drugs

Just a few years ago, it might have been uncommon to hear about CEOs and others taking smart drugs to improve their performance. However, these drugs are not illegal. These are focus and power drugs that give business people an extra edge. For instance, according to Mind Lab Pro, nootropics change the brain in a way that lets you access more neurons and thinking power. This can range from intense prescription medications like Adderall to simple caffeine supplements, to vitamins. Not every one of these substances is right for everyone, but many of them can aid your creative problem solving.

 

Standards

Improve your startup by having a standard that must always be met. When people know what they must meet to stay a part of the team, it will help improve their focus all around. Don’t just write it down, but review it daily to ensure you’re getting the most out of every member of the team.

 

Iteration

There is always room to improve. Constantly iterate and check your results. One tweak could mean the difference between profit and loss.

In the world of startups, the ones that move with the most focus and speed win. Don’t risk falling behind. Use the tips above and watch your results grow day by day.