Gas Costs Bringing Your Business Down

Category: Business Law and Planning

The skyrocketing costs of gas are hitting all of us. Business owners are especially concerned as to how this will hit their bottom line, both directly in the costs of materials and shipping, and indirectly, as employees look to balance the cost of getting to work against their paycheck.

It appears that the New Jersey Assembly is trying to help. NJ Biz reports that Bill Would Allow Gas to be Sold at Cost or Below:

"A bill designed to lower gas prices by removing the state''s gasoline "price floor" was approved by an Assembly panel yesterday. "

"Service stations with convenience stores or auto-repair shops make the most of their revenue from those more profitable services, not the sale of gasoline, [Assembly Person] Burzichelli said. Allowing gasoline to be priced below cost would allow stations to lower prices to attract more customers for those services while simultaneously providing a much-needed price break at the pump, he said.

New Jersey has required gas station owners to price their fuel above cost since 1938, when many states enacted laws to protect consumers from gas companies that would undercut competitors in sparse marketplaces to gain a monopoly on fuel sales, Burzichelli said."

Other employers are looking to take their own action to control the indirect costs of gas prices. Some ideas and concerns:

• Provide gas allowance - note however this must be included in the employees income each year

Foster telecommuting - make sure that you have an appropriate security policy in place in your employment agreement, employee handbook, or other policy regarding remote access of computers. You may also want to invest in a program to be able to track an employee's productivity while out of the office

• Adopt a flex workweek of 4 day / 10 hours, or 9 days/9 hours every 2 weeks - while you need to make sure your critical daily activities are covered, this may allow you to get all the work done for the week in a shorter period, and be a cost free "bonus" to the employees who not only have to commute less days, but get an extra day to address their out of office obligations (perhaps making for more productive employees)

Paid Family Leave now Law in NJ

Category: Elder Law, Business Law and Planning

Hot from njbiz.com, Corzine Signs Paid Leave Bill in 'Legacy Moment' New Jersey's Governor Corzine today signed paid family leave into law. "Calling it a "legacy moment" and a "moral necessity," Gov. Jon S. Corzine today signed into law a bill that will give government and private-sector workers six weeks of paid leave to care for newborns or seriously ill immediate family members."

New Jersey becomes only the second state in the nation to have 6-weeks mandatory paid family leave. The new law is not without its detractors. "Supporters of the bill say the new law will help workers balance their work and family life. Business lobbyists and other critics argue that employers—especially small ones like doctors' offices and car repair shops—cannot afford to lose key workers for up to six weeks at a time. The critics say that becoming the first state in the region to mandate paid leave would further damage the state’s image as a place to do business."

Business owners are obviously concerned that they can't afford key employees to be gone for 6 weeks at a time, regardless of who is paying for the time off. On the flip side, caregivers should take heed of a law that may allow them to devote their full time and efforts to a family emergency without fear of losing their job and all of their salary.

The article outlines the details of the new law are as follows:

"Under the law, workers will get two-thirds of their regular pay, up to $524 per week. Employees could collect the money for up to six weeks and employers would have the option of requiring the workers to first take two weeks of fully paid vacation or sick leave.

The program would be funded by workers, who would pay about 75 cents a week more into the existing state Temporary Disability Insurance fund through payroll deductions. That translates into about $35 per year.

State and federal law now entitles workers to 12 weeks of family leave, but it is unpaid and employers with fewer than 50 employees are exempt. While the new paid family leave bill covers all employers, those with fewer than 50 employees are not required to hold open jobs for workers on paid leave.

Payroll deductions would start on Jan. 1, 2009, with workers able to take paid leave starting July 1, 2009, according to the bill. The Department of Labor estimates that approximately 38,000 individuals, or about 1 percent of New Jersey's work force, will collect benefits annually, but business lobbyists have argued it will be much higher."

3 New Years Resolutions for the Small Business Owner

Category: Business Law and Planning,

I am always in favor of lawyers who can speak English instead of Legalease - here is a 1-2-3 New Years Resolutions for Small Business owners, courtesy of Jean D. Sifleet, Esq. I added some emphasis here and there for some points to really take to heart.

You’ve heard it all before, but year-end is a great time to reflect on your accomplishments and plan for the future. This year, try the 1-2-3 approach.

Succession, retirement and estate planning are closely linked for the small business owner. If a small business owner dies without a succession and estate plan, chaos occurs in the business and for the family. If the small business owner does not have a retirement plan, financial security for the later years of life is uncertain and remains tied to the business.

Doing nothing can have extremely severe and unintended consequences. There are many sad horror stories of family fights and legal battles about how the estate of a small business owner will be divided up by the survivors. Businesses have been forced to sell property to pay taxes owed or close as a result. Many of these problems can be avoided.

As you pull together your year-end financial results, it’s a good time to make your plans for the future. Recent changes in the law make it easier to put more money away for retirement in a tax advantageous manner. This is the time to think about reducing your taxes by funding your retirement plan.

Try the 1-2-3 approach to New Year’s Resolutions.

Resolution (1): Take action.

Taking action before a crisis arises is much better than reacting under stressful circumstances. If your will and estate planning documents were prepared years ago when the kids were little, as is frequently the case, they need to be reviewed and updated. If the small business owner’s will or trust says, “equal shares to my children,” there can be a disaster in the making. Similarly, if you have put retirement and benefit plans in place over the years, it is important to review them from time to time.

Resolution (2): Articulate your long-term goals.

Planning for your succession, retirement, death is never easy. Your goals should drive the planning process. Hence, articulating your long-term goals is a critical step in the planning process. Answering the following questions will help to articulate your goals and establish a framework for planning.

– Do you plan to retire? At what age?

– Do you plan to transfer ownership and/or management within the family?

– Do you plan to transfer ownership and/or management to employees?

– Do you plan to sell the business?

The succession plan is a critical element of estate planning. A succession plan provides for the orderly transition of ownership and management of your company. Basically, the plan becomes a contract amongst the parties. Family members who are active in the business should be treated differently from family members who are not participating in the business. There are ways to equalize the relative shares that each of the children receives, while avoiding the potential for a power struggle in the business.

Resolution (3): Develop a written plan.

It’s critical that the plan be in writing because people have selective memories and memory fades with time. The importance of communication … and more communication amongst family members and key players … cannot be overstated. The plan can be reviewed, discussed, and revised over a period of time.

To avoid problems down the road, succession, retirement and estate planning should be done with professional assistance. Do not just sign over property or give away stock. A proper estate plan is truly a kindness to your survivors. Having a professional review of your plans gives you a clear understanding of what revenue stream you are likely to have in retirement and how your affairs will be handled if you die or become disabled.

Planning ahead is the best way to achieve your goals. Doing nothing can have severe and unintended consequences. So this year, try the 1-2-3 approach. It’s the best gift you can give your family. Best wishes for the New Year!

Business Owners - Don't Fail to Plan

Category: Business Law and Planning

It is a truism that "Business owners often feel that they -- and the business -- will always be around. But without some thoughtful planning about succession, it's common that businesses wither when the owner passes away or leaves."



In Keep Business Alive With Succession Plan from the Small Talk Column of WSJ Online, the author highlights "four steps to making sure your business lives beyond you." These are common-sense concepts to spur you to action. Some key points to consider:



* You need to have a plan as to what will happen to your business if you get hit by a bus.

* Your plan needs to be in writing

* Know who your successors are let them know so you can groom them to succeed

* Be able to finance your succession, whether through a buy-sell agreement, life insurance, etc.



Another truism all business owners should consider: Nobody plans to fail, just fails to plan.