Breaking News: We’ve all officially survived 2022. If that isn’t a reason to celebrate, what is?
As a busy small business owner, you have a lot on your plate each year, which is why the start of the year is the perfect time for you to reflect on the previous and prepare a plan for your business for the year ahead.
This can be overwhelming, but not when you have a business health checklist that prepares you to comply with the legal obligations of your business. You might be asking yourself what’s a legal business health checklist and how it can help my business?
Like many other businesses, if you want your business to thrive this year, using a business checklist will do just that.
In this post, we explain eight ways your business can get legally prepared for 2023.
Read along!
What is a Business Health Checklist
A legal business health checklist is a list that you can use to effectively ensure the health of your business and to ensure that your business meets all its legal requirements. Whether you are an owner of a start-up, a small business owner or a sole trader working from your garage, using a checklist to cover all your essential tasks and planning ahead is a great idea.
Getting organised legally, preparing and planning will help you understand the health of your business so you can start the year on the right foot. You will be able to identify your business’s strengths and weaknesses nice and early, as well as explore each part in depth.
1. Review all contracts
One of the first steps of your business health checklist should be to review the contracts your business has with third-party vendors and partners. This is an important step since more than 86% of businesses have encountered an incident involving third-party vendors disrupting their operations. So if you don’t want your business to experience any difficulties later on in the year, it is a good idea to ask yourself questions like, “Has anything changed regarding this arrangement? “Do I wish to proceed with the agreement(s) going forward?
For example, you may discover through reviewing your contracts that there could be another third-party vendor or partner more aligned with the needs of your business, so what better time to make this happen than the start of the year? This will allow you to enjoy the benefits sooner rather than later.
2. Review Legal Documents
The second essential step you should take is reviewing all the legal documents of your business so that you can ensure your business is complying with recent policy changes, such as those relating to workplace bullying, customer privacy and Covid.
The start of the year is also a hectic time for your business, particularly if your employees are still on vacation from the New Year. During this period, it’s important to check that you or the businesses you have contracts with don’t have deadlines that fall in this period. If you do, you can look at extending these timeframes or fulfilling the contract early.
3. Review intellectual property licenses
Another significant step you should take is to review the intellectual property licenses of your business. You should also consider registering a trademark, especially if you’re operating with a smaller team. One of the most important things you can do for your business is market your products and services, and registering a trademark is a great way to protect your brand.
It can be costly in the future if you don’t have the right to use your own business name, so why not register a trademark now? There are many risks involved if you don’t register your trademark. These include the following:
- Another business could register and legally use your trademark
- You could be unknowingly using a registered trademark
- You won’t have legal protection if another business uses your name
Take the time to tick this off your business health checklist and run a free trademark search before the busy year ahead so you can save yourself plenty of future headaches.
If you want to learn more about intellectual property, watch our video below:
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4. Ensure your business is operating within government regulations (Covid rules)
Whether you’re operating your business from home or your employees are returning to work, it’s important to keep in mind that there may be government regulations regarding Covid that are still in place that may impact your business. Although covid case numbers have declined in recent times, there is still a possibility that your employees can contract covid which would impact your business.
In regards to Covid, regulations are generally inconsistent, and policies are always changing, so you need to ensure that you’re aware of the latest regulations that could impact your business operations.
There is nothing worse than starting a new business year by being held responsible for failing to ensure the safety of your business’s employees health and safety, so make sure that you’re ticking this step of the business health checklist. The Covid government regulations change daily, and it is important to keep up to date. However, here are some tips you can implement to keep your business legally running, these include the following:
- You should allow employees to work from home, where possible, particularly if there has been a recent covid-19 outbreak
- Maintain a physical distance of at least 1.5 meters between people where possible
- Regularly advise employees to wash their hands with soap and water for at least 20 seconds or to use a hand sanitiser
- You should encourage all employees to practice good hygiene
- You should ensure your employees don’t come to work if they’re sick with symptoms of COVID-19 (fever, cough, sore throat, shortness of breath)
- You should allow your employees to work from home if they have COVID symptoms but are able to continue to work where suitable
- Regularly clean your workplace
- You should display signs and posters around the workplace as they are a great way to remind everyone about COVID-19 and what they can do to prevent the spread and to be familiar with its symptoms
5. Review the finances of your business
The goal of every business in 2023 is to thrive. One way to thrive is to have a tight grip on your finances from the beginning of the year. This is not only a smart act but also a responsible act.
A financial review of your business may include the following:
- Paying your bills and finances to ensure goodwill
- Chasing any late invoices from suppliers and third parties
- Have a chat with payroll to make sure your staff details are up to date
- Filing your tax returns on time: set a specified deadline every year
- Reviewing your accounts from external suppliers
- Having a look at your end-on-year sales
- If you’re running a retail or manufacturing business, you should keep a close eye on your stock by performing a stocktake
- In order to create a budget for 2023, you should review your budget from 2022
- You could have your business valued
- You could benchmark your business to see how it compares to similar businesses
Another key consideration is the impact that inflation has had on your business. When reviewing the finances of your business you should consider the following financial effects that inflation will have:
- The running costs of your business will rise due to inflation
- Consumers will be less inclined to spend money aswell due to the impact that inflation has on them and their finances aswell
- There may be periods where your business is unable to make profits due to inflation and therefore the costs of running the business could outweight the revenue
6. Review and update workplace policies
Great employees are a vital asset to your business. To best serve their needs, it’s essential to review your policies and benefits regularly. You should carefully consider the language you’re using in the policies, you should ensure the policies are well understood by your employers and you should consider the types of policies that’ll best reflect the needs of your team.
Additionally, you could consider whether there have been any uncomfortable situations regarding workplace benefits or staff behaviour. As a result, the start of the year is a perfect time to review these policies and get everybody on the same page. For example, it’s important to have a well-communicated Drugs and Alcohol Policy to ensure that your staff is aware of expectations at the various social events in the year where they represent your business.
Additionally, you should another important purpose of reviewing policies is to identify any gaps there may be.
Common policies your business should have include policies in relation to the following:
- Work Health and Safety(WHS) policy
- Harassment and bullying policy
- Leave policy
- Code of conduct policy
- Privacy policy
- Working from home policy
- Internet, email and social media policies
You should take a look at our employee handbook to learn more about how the policies you can provide your employees with at the beginning of the year.
7. Consider staff requirements
As your business grows, so will the number of your employees. So having a well-planned strategy for your existing staff and potential new employees is an important part of your business health checklist. Now that working from home is common, your business should consider early on in the year how it will best manage the changing working conditions and maintain the mental health and happiness of all your employees.
Employers have a legal obligation under the various state Workplace Health & Safety Acts to prevent the risk of hazards to their employee’s mental health. Hazards to mental health include high job demands, poor support from management and bullying. Happy and healthy employees are vital to the success of any business, but it can’t be done if employees are not receiving the proper support.
The start of the year is the best time to figure out a plan to maintain the mental health of all your staff members, and here are some ways to tackle this:
- Reducing stigma about mental health—Update your WHS policy to reflect you value of your employees’ wellbeing.
- Providing individual support— Employees have different family situations and living situations, so take to time to understand their individual needs
- Designate time for the team and business bonding— Coffee breaks, lunches and even games over Zoom
- Providing a designated HR specialist or team leader for employees to go to if they need further assistance
- Establish a culture of openness, inclusion, and acceptance
- Provide training to the management team so that they can effectively communicate with employees and assist them with issues they may have in regard to mental health
- Make sure all employees have the opportunity to voice their opinions and concerns
- Develop and implement mental health programs
By creating an environment that supports the well-being of your employees, you will be making a workplace that allows staff to perform at their best.
8. Conduct audits
Conducting a business audit is something many businesses put off in their business health checklist. We get it, the end of the year can be very busy, and the thought of looking at numbers seems tedious but did you know that it may be a legal requirement for you?
Under the Corporations Act 2001, audits are a legal requirement when a business does any of the following:
- Make an annual turnover of more than 2.5 million dollars
- Have total assets of more than 12.5 million dollars
- Employ over 50 employees
Even if your business doesn’t fall into one of the categories above, there are many benefits of conducting a business audit. Whether you choose to conduct an internal audit initiated by your business or an external audit undertaken by a registered auditor independent of your business, it is never too late to get it done.
Audits have many benefits for both small and large businesses, these include the following:
- Improving business efficiencies— the day-to-day operations of your business by identifying inefficiencies
- Providing assurances to partners—showing partners the financial health of your business
- Improving business control— identifying procedures for fraud, improving tax planning
- Strengthening the credibility of your business financial record
There is no better way to finish ticking off your business checklist than to ensure that your business is financially healthy.
Conclusion
To ensure that you and your employees tackle this year without a hiccup, particularly at the beginning, make this checklist a priority. Take the time now before it gets jam-packed to implement the tips above, so you know that your business will go in the right direction. The following are the things you should focus on:
- Review all contracts
- Review legal documents
- Review intellectual property licenses
- Ensure your business is operating within government regulations (covid rules)
- Review the finances of your business
- Review and update workplace policies
- Consider staff requirements
- Conduct audits
You should also ensure that you understand your legal obligations so you are well prepared to mitigate any risks. If you want to check how legally ready your business is you should use our free legal health check.
Legal Health Check for Small Business
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