In the whirl of creating a business you love, focusing on what you give, how to market it, and actually doing the work – have you also ticked off the legal aspects?
This week’s interview with Vanessa Emilio of Legal123 about what’s required for your business website, “ASIC is now reviewing and fining websites on a regular basis for non-compliance”, find out why below.
Vanessa, what gave you the idea to set up this online legal service?
I’ve been a corporate and finance lawyer for 18 years working in-house for large banks and corporates and gained exposure to a lot of varied areas of the law. As a result, I used to have friends and colleagues asking for help on their personal things such as Wills, Powers of Attorney, and similar agreements.
I realised that there were no Australian legal websites out there to help people who wanted to manage their own affairs. We started Legal123.com.au 6 years ago (before anyone else!) and it has really evolved quite accidentally into where my passion lies: online start-up businesses!
We try to ensure we have affordable templates and also do quite a bit of custom legal work for start-ups, entrepreneurs, contractors etc at affordable prices. There is no other legal resource like this available and I love what we do!
It’s grown enormously in the last few years and we are very proud to be helping our customers and clients with some really great ideas they have for their businesses! Having done the ‘start-up’ ourselves, we understand more than ‘just a law firm’ and know the tips and tricks and ‘ins and outs’ which is a rare skill, most lawyers don’t have this experience.
For those just starting their own business, what are your 3-5 must-do action items to make sure the legal aspects are covered?
Most start-ups are on a tight budget so they’re unwilling to outlay a lot of money until they see how their business and idea grows. This can be a problem if you haven’t structured correctly in the first place and not protected your personal assets.
You may find it difficult to get investment capital, to take on and hire staff, or to manage any customer legal claims. So the top 4 things I would recommend to ensure you do:
Protect yourself, your assets, and your business:
Most online start-up businesses are run as a registered business or even just a website by sole traders rather than Pty Ltd companies. This means their personal assets are at risk.
If you decide not to jump into the company structure, the next best way to protect yourself and your business is to ensure you have really strong legal terms and conditions for your business.
They don’t have to be expensive but at least you will have a limitation of liability to limit any claims that may arise, and you can protect your business idea as well as ensure you have terms to rely on in the event of any customer claim. Good terms and conditions also go a long way to deflecting potential customer claims.
Update Terms to Meet Consumer Law Requirements:
If you’re selling goods and services, Australian consumer law requires you to ensure minimum requirements for sales, service of goods, as well as warranty and refund requirements are met.
The law on this is fairly recent so many businesses have been caught out and fined by ASIC for this.
Ensure your terms are up to date and also that you know your customer requirements as a business owner for goods and services you sell. For example, if you import goods to sell, you must still meet Australian warranty requirements, irrespective of what the offshore manufacturer may be offering as a warranty.
Privacy Policy:
You MUST have a current privacy policy if you are collecting any type of personal information.
You also need to ensure you have a process in place to understand your privacy requirements. For example, if you collect email addresses of your clients/ customers, you need to regularly and safely delete any customers that are no longer current customers within a reasonable amount of time after they have no contact. You cannot keep old personal data.
You also need to ensure your client’s personal data is kept up to date and that you immediately delete any customer who asks to have their information deleted from your files. You also need to have a process to regularly ‘purge’ old information, data and other customer details.
Regularly check your website:
You should have a process to regularly check your website and update it. YOU are responsible for everything on your website whether you posted it yourself or not.
You need to ensure:
- It’s up-to-date,
- Meets the latest legal law changes, which are happening regularly,
- That you regularly check any blog or forums on your site for defamatory, copyrighted material, obscene, or otherwise illegal posts.
- You are obligated to immediately remove any material that may be considered defamatory, infringing another person’s copyright or otherwise illegal material that may offend third party rights.
And whatever you do: do NOT copy other website terms and conditions!
For the small cost of templates, you can ensure you are protected: it’s not worth the time or risk to try to copy another site that may not be up-to-date, relevant or even legally compliant!
What are the common mistakes or omissions that you see businesses making online when it comes to protecting themselves legally?
Good question! Everyone thinks they can save money by writing their own business terms and conditions.
Or worse, they copy from another website that is involved in the same type of business.
We’ve seen clients who have come to us, as a result of copying other website terms with either copyright infringement claims against them, issues where they had someone else’s terms on their site that they don’t want to honour, and even one client who came to us after he had included the jurisdiction as California.
This meant, when there was a claim, he had to travel from Australia to defend the customer claim in a Californian court. He requested our assistance AFTER he had made this error and it ended up costing him a lot of time and $ to defend overseas.
Second most common error: not having any terms and conditions or privacy policy. ASIC is now reviewing and fining websites on a regular basis for non-compliance, as is the Privacy Commissioner .
What about social media; do you have any advice on protecting your business, what are the common pitfalls that small businesses need to consider?
Another good question, you will see it’s close to my heart as I’ve written several blog posts on this exact topic.
Social media is a great way to promote your business. But many businesses start up using social media exclusively rather than through their own website and there have been many problems with this.
Here are the top 3 tips to be aware of:
- Have your website ready, up and running BEFORE you start your social media marketing.
- Know that you don’t ‘own’ your clients on social media. At any time, and for very little or no reason, your social media account may be closed. It may be that others are posting things on your account which breach the social media terms – it doesn’t have to be you. And you don’t own your clients: E.G., if you read Facebook’s terms carefully, they can close you down, market to your clients, and use any information you post on your account at any time, and long after you have closed your Facebook account.
- Be aware that you still have to comply with Consumer Law requirements for ANY sales you conduct via social media outlets. And know that social media terms protect them, not you. So ensure you have your own and are protected – sell through your website, not through social media.
I always wonder about Pinterest – it seems like a free-for-all of pinning other people’s work, images, quotes, etc. Are individuals at risk here?
Pinterest has and will continue to come under fire for permitting and enabling people to post other people’s material and, in many cases, breach copyright.
If you want to market your business using a curation site like Pinterest, ensure that your material contains a watermark of your business or some type of identification, and be aware that you may risk losing copyright otherwise.
If you find that someone has used your material, ensure you immediately send them a copyright infringement notice to get them to take it down.
This way you are protecting your copyright rights, otherwise you are seen to permit it and will have difficulty claiming ownership. This infographic helps succinctly explain some of the myths.
We use and recommend Legal123 for all our websites, and this is our affiliate link, should you need to cover yourself.
Vanessa Emilio is the Practice Director of Legal123 Pty Ltd & CEO of the online legal website – Legal123.com.au – which specializes in providing legal agreements, forms & templates to everyday Australians. She founded the business believing there was a gap in the market: helping the general public avoid expensive lawyers & instead access standard legal documents, like Wills and Power of Attorney forms, through the Internet.
Vanessa can be contacted via email at vanessa@legal123.com.au or through the website: www.Legal123.com.au
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