New areas of law develop quickly these days, presenting unique legal and business challenges. What are some of the most pressing issues with these novel and constantly evolving facets of the law? In this month’s discussion, we hear from four trailblazers about two distinct and cutting-edge areas: marijuana and drone law.​

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The Question of Non-Disclosure Agreements

If you are contemplating entering into a business relationship with someone, the first agreement you may encounter is a non-disclosure agreement (NDA). NDAs are used, among other times, when starting new businesses; acquiring new technology or other operational needs; and in the discussions to purchase or sell an existing businesses. Often times, one party to such a discussion will suggest that an NDA be executed and present the other party with a form agreement.

The following is a checklist for you to consider when either receiving or creating an NDA:

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When you formed your business, you may have contemplated what type of business entity to choose.  You likely considered sole proprietorship, partnership, corporation or limited liability company (LLC).  Each entity has certain advantages and some disadvantages. Generally, to protect yourself from personal liability, the two best alternatives are either a corporation or a limited liability company. 

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If you have a Nevada Limited Liability Company (“Nevada LLC”) and you have worked with me in the past, you know I believe it is vital for you to have an Operating Agreement. An Operating Agreement, although not legally required for a Nevada LLC, can set forth the rights and responsibilities of the Members of the Nevada LLC.  It can spell out how you add additional Members; how you sell Membership Interests; and in the case of a business divorce, it serves as a prenuptial agreement.

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According to a “Las Vegas Review-Journal” article in January 2016, if job creation stays at its current rate, Nevada’s small businesses should reach peak employment by late 2016. Managers within small businesses are looking to fill their ranks with new employees.

If your business is among those looking to grow, you must make sure that you start the process in a way that will enable you to hire qualified individuals without exposing your business to liability.  Employment litigation is one of the fastest growing areas of litigation that employers face. Employers may face legal exposure, not just from conduct after hiring an employee, but from conduct during the hiring process itself.

Which tools should you keep in your toolbox and how should you use them when you start the hiring process? As with all things business related, Gordon Law recommends you make, maintain and keep documentation associated with your hiring process.  At a minimum, we recommend that you maintain the following:

  1. An accurate job description for the position. You should be certain to include the essential job functions of the position along with identification of expectations and metrics for measurement of performance;
  2. Hiring processes and procedures. You should set forth how you seek prospective employees and what objective factors you are including in your identification of meritorious employees; and
  3. Keep all of the applications and/or resumes you receive.

Beyond your hiring tools, you should be certain that you are not violating any laws or regulations in your hiring and interview process. The best way to do this is to know about protected classifications and avoid discrimination. You should not ask questions, nor base hiring decisions, that relate to the following:

  1. Age
  2. Gender identification
  3. Disability
  4. Ethnic origin
  5. Marital status

You should also be aware of the new trend known as “Ban the Box.” Since 2009, 21 states have adopted a policy requiring the removal of the criminal conviction history question on job applications.  Although there is no such law in Nevada yet, it is anticipated that one will be under consideration in the 2017 Legislative Session.  Furthermore, the U.S. Equal Employment Opportunity Commission (EEOC) and the Obama Administration have proposed policies that direct both public and private employers to refrain from asking about criminal convictions. According to the National Employment Law Project, there are now more than 185 million people in the United States (over half the population) who live in a “ban the box” jurisdiction.

Once you have identified your new employee, make sure that your hiring decision is predicated on a legitimate, non-discriminatory basis. You should document the objective standards that caused you to offer employment to a particular candidate.  Furthermore, if there is more than one qualified candidate for the same position, you should document why you decided on Candidate A instead of Candidate B.

Gordon Law is here to assist you with any human resources questions or other areas of inquiry that affect your business.

In answering the question, let’s start with the definition of a document retention policy. Instead of using unnecessary legal terminology, consider the policy as simply a document management policy. In the course of your business, you will likely have pages and pages of documents either in hard copy or in electronic copy. A good document management policy will provide you with a guideline as to what you must, should or can keep, and give you the liberty to destroy what you do not need.

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In 1985, Aretha Franklin released one of her best selling albums.  The title track was Who’s Zooming Who – an upbeat song about the push and pull of pursing a new relationship.  To their core, business relationships are simply that – relationships.  How should you decide whether a person is the right person to become a business partner?  In addition to delving into your business partner’s characteristics, the question requires a glance in the mirror to see what you, truly, bring to the table.

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Do you think you have Independent Contractors instead of Employees?  As a business owner, if you have Independent Contractors, you do not have to withhold taxes; provide benefits; or even pay minimum wage. Unfortunately, Nevada law and Federal law have recently made sweeping changes in how they define an “Independent Contractor.”  If you improperly categorize the worker as an Independent Contractor, you may subject yourself to fines from both the State of Nevada as well as the Internal Revenue Service, including liability for unpaid payroll taxes (for which you will be personally liable); unpaid unemployment taxes; unpaid workers’ compensation premiums; overtime liability; as well as the costs of benefits that you offer to your other employees. 

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As you are aware from my earlier blogs, it is vital for your business that you have and maintain good contracts.  As you know, a contract is an agreement that sets forth the rights and obligations to the parties.  However, one of the most vital reasons to have written contracts is to address what happens when things go south…when the other party to the agreement does not fulfill its responsibilities.  A dispute resolution clause can help you to know, in advance, how you can address contractual problems.

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At the tail end of the 2015 Legislative Session, Governor Brian Sandoval signed AB 175 into law. The legislation which permits Transportation Network Systems, like Uber and Lyft, that connect passengers with drivers through smartphone apps, came after substantial legal wrangling that preceded the legislative session and several false starts within the Legislature.

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