Employees Deserve a Workplace Free of Politics, Discrimination & Harassment

Most Americans are aware that many people now publicly share strong political opinions that can hurt or insult others. While we each can decide how to handle this problem in our private lives, employers face far greater challenges. Their need and right to create a highly productive and politically neutral workplace must be carefully balanced against legitimate free speech concerns, applicable state laws and the governing provisions of the NLRA (National Labor Relations Act).

Carefully developing a company policy that protects the legal rights of all concerned takes considerable planning and input from experts. Should errors be made and employees sue their employers claiming a hostile work environment has developed, the courts will have to weigh the presented evidence and decide if any damages are owed.

Balancing the right to control worker productivity with First Amendment rights

Since employee free speech rights in most workplace settings are not absolute, political neutrality must be maintained and enforced in a highly consistent manner. Simple complaint procedures must be created and employees at all levels properly disciplined when actionable abuse has occurred. Courts may have to decide whether an office atmosphere became so severe that aggrieved employees not only had the right to sue – but should be awarded financial damages.

Here’s an overview of the key topics you must address in an office policy that seeks to maintain a workplace free of harassment and discrimination based on political views. Company owners should speak with their Houston employment law attorneys about how they can create this type of policy — while still paying proper legal respect to the rights of all parties concerned.

Key points to cover in an office policy designed to limit conflicts over political speech

  • Public and private employers. Your policy must clearly reflect whether your employees are working for a private employer or some type of public or government entity;
  • Abide by the NLRA. You must make it clear that any limitations you place on “political discussions” in the workplace are in full keeping with the language and intentions of the National Labor Relations Act (NLRA). After all, there are instances both during and after work hours when some employees may have a legally protected right to discuss certain aspects of their jobs with their co-workers;
  • All employees must be covered by the policy. Indicate that all supervisory personnel will also be required to greatly limit their own discussions or expression of questionable free speech topics related to politics;
  • Provide time for discussion of the policy. This might occur during all future new employee orientation programs – or when privately meeting with each new worker in your human resource manager’s office. It would be wise to consider having each current or new employee sign a form indicating they’ve been given a chance to read over the policy and ask questions about it. Be prepared to explain that the wearing of certain types of political buttons and T-shirts at work will not be allowed;
  • Make it clear that you will respect employee needs for time to vote. You can encourage workers who won’t have time to stand in lines before or after their work hours to tell you in advance of their needs (if certain positions must be covered in their absence). However, you should try and remain as flexible as possible regarding this type of request;
  • Indicate your awareness that some employees may choose to run for public office. Should this occur, privately ask any such employee to avoid discussing a run for any non-union office during work time. However, you should acknowledge your full awareness of the person’s right to pursue this type of activity on their own time;
  • Consider revamping your overall policy against workplace harassment and discrimination. You might want to ask your lawyer to either redraft this type of policy or carefully add new provisions to it that clearly forbid workplace harassment, discrimination or retaliation based on any worker’s real (or imagined) political affiliations. This approach might help you avoid the false impression that you are attempting to place a “chill” on employee free speech rights – when you’re simply trying to extend new protections you believe are owed to all workers.

While this list is not intended to be comprehensive, it should provide you with a better idea of how important it is for you and your entire workforce to have a policy in place that addresses these crucial topics. We all deserve to work in an office that’s as politically neutral as possible so we can do our best work.

Our Murray Lobb attorneys are available to help you draft policies like this one — or any of the many contracts and other documents you need to daily run your business. We’re also available to provide legal advice on many general business, employment law or estate planning topics.

CARES Act – Government Economic Relief Package for Businesses

Last week the United States Government passed what is known as the CARES Act to provide economic relief to businesses (including sole proprietorships!) impacted by COVID-19.  There are a few different avenues and programs to receive help under the CARES Act, one of which is the Paycheck Protection Program (PPP).  The Paycheck Protection Program is specifically designed to help small businesses keep their workforce employed. Visit SBA.gov/Coronavirus for more information on the Paycheck Protection Program and the other available avenues and programs for assistance.

The new PPP loan program will be available retroactive from Feb. 15, 2020, so employers can rehire their recently laid-off employees through June 30, 2020. 

 Loan Terms & Conditions

  • Eligible businesses: All businesses, including non-profits, Veterans organizations, Tribal concerns, sole proprietorships, self-employed individuals, and independent contractors, with 500 or fewer employees, or no greater than the number of employees set by the SBA as the size standard for certain industries.
  • Eligible Purposes: payroll, rent, mortgage interest or utilities.
  • Maximum loan amount up to $10 million
  • Loan forgiveness if proceeds used for payroll costs and other designated business operating expenses eligible purposes in the 8 weeks following the date of loan origination (due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs)
  • All loans under this program will have the following identical features:
    • Interest rate of 0.5%
    • Maturity of 2 years
    • First payment deferred for six months
    • 100% guarantee by SBA
    • No collateral
    • No personal guarantees
    • No borrower or lender fees payable to SBA

Murray | Lobb has contacts with multiple lending institutions who are already approved SBA lending processors and can help you navigate the process.  Give us a call at 281-488-0630 or email sgriffin@murray-lobb.com and we will be happy to provide you with these contacts.

Important Legal Tips for Communicating with Disabled Employees

Since everyone deserves to be treated with respect, employers must make sure that they’re communicating professionally and politely with all their disabled workers. Careless employers who speak callously with their disabled workers not only set a poor example for everyone else in the workplace – they also increase their chances of being sued for unlawful discrimination under the Americans with Disabilities Act (ADA).

Here are some other important tips that can help you create a more pleasant work environment for everyone – that’s also fully compliant with the ADA.

Examples of workplace situations that may require special communication skills

  • When someone present in a meeting has a hearing disability. Should there be an employee present with a known hearing impairment, always remind everyone to speak one at a time – and never “over” one another. That will help everyone more easily follow the conversation and possibly take notes. Of course, never refer to the person by name who may need this simple accommodation.
  • Always speak directly to the disabled person. Even when someone has a sign language interpreter, always turn and speak to the disabled person – and not their helper or other companion – whenever possible.
  • Be honest with the disabled during regular workplace evaluations. This is important so they’ll have the chance to improve their performance – and request any new accommodations they may need. They deserve an honest appraisal like everyone else. This will also limit the chances of painful misunderstandings in the future. Be willing to give them concrete ideas for how they can improve the quality of their work.
  • Be prepared to shake the hand of a disabled person – even if this means shaking their left hand and not their right one. This is a simple gesture that communicates respect and equality. You don’t need to shake the person’s hand for an extended time period.
  • Always introduce yourself when speaking with someone who is sight impaired. Be sure to also identify everyone else who is present during the conversation.
  • Never pat anyone who is very short (or in a wheelchair) on the head or shoulder. This makes all adults – and even older teens – feel a bit demeaned. We all have a right to have our “personal body space” fully respected by others.
  • Should you decide to offer a disabled person your assistance – wait briefly to find out if they would like to accept it. For example, it’s possible you may want to help someone transfer from a wheelchair or walker to a nearby chair. However, be aware that many disabled people want to move about on their own as much as possible, to maintain their sense of independence.
  • Be sure you’re addressing the disabled person in the same manner as everyone else present. Far too often, well-meaning bosses or employers may refer to the new department head who’s disabled as “Johnny” – while calling everyone else in the room by his or her last name. Be consistent with how you refer to all who are present.
  • Don’t lean on, move, or play with a disabled person’s crutches, wheelchair or walker. You may think you’re just being lighthearted – but when you do this, you’re calling attention to the person’s disability when that person may simply want to blend in with everyone else. However, if you believe it’s a safety hazard to leave a wheelchair or other assistive device where the disabled person left it, always politely ask that person if you can move it to a different location to make it easier for everyone to walk in that area. Also, be sure to tell the disabled person that you’ll personally retrieve the device when the meeting or seminar is about to end. Finally, never lean on someone’s wheelchair for support – that often makes disabled people feel like you’re violating their personal body space – and that can make them feel very uncomfortable.
  • Be very respectful when listening to a disabled person talk who has a speech impediment. Never assume you’re helping them by suddenly announcing a “translation” or “clarification” of what was just said. Instead, if you think you and others were left a bit confused by what was stated, calmly wait until the person finishes talking and say something like, “So, if I understood you correctly, you’re asking or suggesting that we start handling this account differently in this manner” – repeating what you think you heard. If you misunderstood what was said, then give the person a chance to repeat what they said earlier – or allow them to present it to you in a different way.
  • If someone you need to speak with is in a wheelchair, respectfully pull up a chair so you can speak with that individual at eye level. This conveys both respect and equality.
  • Never assume that all hearing-impaired people can read lips. Should you need to gain the attention of a hearing-impaired person who is looking off in a different direction, very lightly tap the person on his/her shoulder to gain their attention (assuming you’re not interrupting another conversation). If you’re certain someone can lip read – stop eating, drinking or smoking – so it will be easier for that person to follow what you’re saying.
  • Try to interact naturally with the disabled. Should you accidentally say something like “Did you hear that there’s an extra meeting next week?” – only to realize you said that to someone who is hearing impaired, forgive yourself. You can then point to a flyer about the meeting or write the information down on a piece of paper and hand it to the disabled person.

Always remember to stay calm and polite, even if you’re finding it hard to communicate with the disabled worker – and realize that the situation may be far more frustrating for that individual. If you’ll be speaking with one or more disabled people during a meeting, try to let them know, in advance (through a medium they can easily access like email), that you’ll be supplying everyone with a complete summary of the meeting’s highlights in a follow-up email.

If one or more workers are sight-impaired and read Braille, let them know that you’ll get a copy of the meeting notes to them in that format (if you have that capability) within one to two business days. Also, tell them that you’ll be happy to answer any questions they may have prior to their receiving their copy of that summary. Finally, whenever possible, use such terms as “hearing impaired” instead of deaf – and “sight impaired” in the place of blind.

Please feel free to get in touch with one of our Murray Lobb attorneys so we can provide you with any guidance you may need when relating to your disabled employees. We’re also available to provide you with legal advice concerning many other general business, estate planning or employment law topics. And we can draft a wide variety of legal documents on your behalf or help you revise an outdated employee handbook.

Unintentional Partnership in Texas

Question: Can two or more persons create a partnership even though they did not intend to do so?

Answer: Yes, under certain circumstances.

   Generally, under Texas law an association of two or more persons to carry on a business for profit as owners creates a partnership, regardless of whether (1) the persons intend to create a partnership, or (2) the association is called a “partnership”, “joint venture”, or other name.  Partnerships are governed by Chapter 152 of the Texas Business Organizations Code.

   What this means is that two or more people could in fact cause the creation of a partnership even though they did not intend on doing so.  The consequences of being partners is the fiduciary duty which arises between partners. The Texas Business Organizations Code also sets forth factors indicating that persons have created a partnership. These factors include:

(1) Receipt or right to receive a share of profits of the business;

(2) Expression of an intent to be partners in the business;

(3) Participation or right to participate in control of the business;

(4) Agreement to share or sharing:

       (A) losses of the business; or

       (B) liability for claims by third parties against the business; and

(5) Agreement to contribute or contributing money or property to the business.

Interestingly, an agreement by the owners of a business to share losses is not necessary to create a partnership.

   On January 31, 2020, the Texas Supreme Court held that parties can conclusively negate the formation of a partnership under Chapter 152 of the Texas Business Organizations Code through contractual conditions precedent. The condition precedent was that the “venture” would not come into effect until the respective parties’ board of directors approved the deal.  The boards of the companies never approved the venture and thus that one provision saved one of the parties almost half a billion dollars:

Texas Supreme Court upholds Court of Appeals reversal of FIVE-HUNDRED-MILLION-DOLLAR trial court verdict. In Energy Transfer v. Enterprise, the high court dealt with a clause that contained conditions precedent to forming a partnership. Enterprise and Energy Transfer, two of the top ten largest energy companies in the United States, sought to re-purpose an existing pipeline or build a new one to transfer crude oil south as opposed to north. The two companies expressly rejected creating a partnership until two conditions precedent were met: 1) execution of definitive agreements memorializing the terms and conditions of the pipeline transaction that 2) received approval from each party’s board of directors. Subsequently, when the companies failed to get shipping commitments to cover the potential costs of the pipeline, Enterprise ended talks with Energy Transfer. Enterprise would eventually go into business with ConocoPhillips. Energy Transfer, believing Enterprise and Energy Transfer entered into a partnership agreement, sued Enterprise claiming breach of fiduciary duty. (Fiduciary duty is putting the wellbeing and interest of the person for whom they are responsible above their individual interests; the duty commands exceptional loyalty of the party owing a fiduciary duty.) The trial court awarded Energy Transfer damages totaling $535,794,777.40. Enterprise appealed, and the Court of Appeals reversed the trial court’s ruling and found for Enterprise. As a result, Energy Transfer filed for review with the Texas Supreme Court. Enterprise continued to argue no fiduciary duty existed because no partnership was entered into between the parties. The Texas Supreme Court agreed. The Court, applying long-standing freedom to contract law, held that parties could require conditions precedent to the formation of a partnership notwithstanding the Texas Business Organizations Code’s five factor partnership test.

   It is the general rule that when an agreement provides a condition precedent to the formation of a partnership, it will not come into existence until the condition has been met. However, such condition precedent may be waived and, if the parties actually proceed with the business, they may be held as partners even though the condition precedent has not been satisfied.

   Chapter 152 is not the sole source of rules for determining partnership formation. The determination of formation of a partnership should “include” the five factors listed in the section. Those factors are not exclusive. Principles of law and equity supplement the statutory partnership provisions unless otherwise provided by this chapter or the other partnership provisions.

What should persons do when looking into a business venture?

   First, the parties should enter into a written agreement, which can be informal, clearly stating that the parties are contemplating a business venture, or exploring the feasibility of a business venture; and that despite negotiations with third parties, expenditures of funds towards investigating the venture, reimbursement or sharing of expenses between the parties, no partnership shall be created “unless …….” (clearly and specifically stated).

   That “unless” is the condition precedent.  The condition can be approval of a formal agreement by the board of directors of corporations, by the manager or managers of an LLC, or the signed agreement for the formation of a partnership.  The condition could be the enactment of a trade agreement with another country, or even a minimum price making up the subject matter of the venture, such as the price per bushel of corn must be “$$$” before any business venture shall be formed, or as simple as requiring the respective wives of the parties to approve the venture in writing.

   Make sure oral agreements are disclaimed and a provision that the parties disclaim any reliance upon any representation made by, or information supplied by, the other party, and waives any claims for fraudulent inducement.

Should you need help understanding the laws surrounding General Partnerships, please contact one of our Murray-Lobb Attorneys.

Understanding the Purpose and Benefits of HB 4390

Texas and many other states have recently been passing new data breach protection laws to be sure that consumers receive timely notification after their most sensitive personal information has likely been breached or stolen. In June of 2019, HB 4390 was signed by Governor Greg Abbott. It became effective on January 1, 2020.

What HB 4390 is designed to accomplish – in general terms

Known as the Texas Privacy Protection Act, this legislation amends pertinent portions of the Texas Identity Theft Enforcement and Protection Act (“TITEPA”) set forth in the Texas Business & Commerce Code. In addition, the Texas Privacy Protection Act creates the Texas Privacy Protection Advisory Council that’s currently studying the data privacy laws of other states and countries.

HB 4390 requires this council to report its findings to the legislature by September 1, 2020 – so more comprehensive consumer privacy legislation can be considered during the next session of the Texas Legislature, beginning in January 2021.

New notification duties after suspected data breaches in the future

Now that the Texas Privacy Protection Act has gone into effect, the following new rules must be obeyed by all companies doing business in the state.

  • HB 4390 has added a new deadline. Consumers must be timely notified when there’s been a definite or suspected data breach (of sensitive personal information). This notification must be made within 60 days of the date when the apparent breach was discovered.
  • As amended by HB 4390, the TITEPA requires businesses to provide notice of certain types of data breaches to the Attorney General of Texas. More specifically, notice is mandatory when a breach has compromised the data of 250 or more Texas residents. This notice to the AG’s Office must also cover the following topics.
  1. The nature and circumstances of the breach must be described – and information must be provided about how the compromised data has been used (if known);
  2. There must be a statement about the number of Texas residents who were affected by the breach and when notifications were sent out;
  3. The reporting party must describe any measures taken to address the consequences of the breach;
  4. The AG’s Office must also be told whether any additional, corrective measures (regarding the suspected breach) are planned in the future; and
  5. There must be a statement about whether any law enforcement agency is currently involved in investigating the reported breach.

At present, at least 17 other states have established similar timeframes for reporting data breaches, usually between 30 to 90 days after the breach was discovered.

The Texas Privacy Protection Act also created the TX Privacy Protection Advisory Council

As was briefly noted above, this council will be meeting regularly until it tenders its required report to the Texas legislature by early September 2020. It’s hard to know if the group’s recommendations will be very comprehensive since some legal experts are concerned that Texas is rather hesitant to pass the full panoply of data breach protections that may be necessary. Far stronger measures were rejected – when HB 4390 and another bill were first proposed in Texas.

Better protection for victims of data breaches will likely be affected by the views of those currently sitting on this council. Here’s a look at the membership of this group.

  • Three of those who are on the council are members of the current Texas House of Representatives;
  • Three others are Texas senators;
  • Nine seats on the council were reserved for representatives of a wide number of industries including: consumer banking, technology, internet, medical profession, retail and electronic transactions, telecommunications, cloud data storage and social medial platforms;
  • Just two members of the Texas Privacy Protection Advisory Council are either members of a nonprofit organization that regularly evaluates data privacy issues from the viewpoint of consumers – or are professors at a Texas law school (or other higher educational institution) who have had important work published regarding data privacy.

Hopefully, most Texans will be pleased with the legislation that will eventually be passed based on this group’s recommendations.

Please feel free to contact one of our Murray Lobb attorneys if you have any additional questions about how this new legislation may affect your company either before or after you experience a data breach. We’re also available to address any of your other general business law needs — and we can readily draft the contracts and other legal documents you need to run your company each day.

Overview of Small Business Administration Online Courses

Ever since our government created the SBA (Small Business Administration) back in 1953, it’s been working hard to promote, assist and protect America’s small business interests. Chief among its goals is to help entrepreneurs as they try to create and “grow” new companies.

During recent years, the SBA has been offering online courses that can help people focus in on creating viable business plans – while also securing adequate funding for their initial marketing and other needs. Whether your business is still in the planning stages – or already gaining traction – you can benefit by taking several of these courses.

SBA classes can greatly help many business owners

  • The All Small Mentor-Protégé Program. Like most of the courses offered, this one allows you to glance at a course transcript or outline before starting the class. This 30-minute program is designed to help entrepreneurs decide if they’re businesses are ready to sell goods or services to the federal government. If you believe your business is ready, you can take this course and use the certification of completion while applying for acceptance into this mentor-protégé program;
  • Business opportunities. This 30-minute class (offered on a self-paced basis), helps entrepreneurs learn how federal contract procedures work and what they must first do before trying to sell goods to the federal government;
  • A course on gaining a competitive advantage for your company. This SBA class teaches students how to accurately evaluate their competition, create a brand, seek out potential customers and decide how best to set prices for their goods and services;
  • Financing your business. There are many ways to come up with the money you’ll need besides funding it yourself or obtaining a bank loan. This class explains the basics facts about venture capital, crowdfunding, angel investors, grants and other sources. You’ll also gain a better idea how to figure out your exact start-up costs and other expenses;
  • Legal requirements for a small business. This course explains many basic aspects of employment law that must be understood before trying to start a company. One key topic looks at how you must responsibly hire and fire employees. Be sure to speak with your Houston business law attorney during the earliest stages of starting your company to make sure you’re complying with all applicable state, local and federal laws;
  • Social media marketing. Every small business owner must learn how to properly market goods and service to the public using social media platforms like Facebook, Twitter, Pinterest, LinkedIn, YouTube, Tumblr and others. This course also teaches students how to reach their prime or target audiences based on such factors as age and location;
  • Growing an established company.  At some point, most companies find themselves facing unexpected competition or a change in market forces that makes them need to retool their approach to winning new customers. This class will help you determine if your company is ready to expand and how to carry out that goal. It also teaches important growth strategies;
  • A course on buying a company already in business. Terms like due diligence are explained so that students will understand the critical need to learn all they can about any business before buying it,
  • The special cybersecurity needs of small businesses. This course helps acquaint owners with some of the ways they can try to protect themselves against major cyber threats that can take down websites and otherwise disrupt normal business transactions. There’s also a related class that describes useful ways to prevent general crimes from being committed against your company.

All the courses referenced above may prove useful to a large percentage of new businesses (or those needing to reinvent themselves). The following brief synopses are related to classes created for unique groups of entrepreneurs.

SBA classes designed for the needs of specific individuals and groups

  • Special contracting opportunities for veteran entrepreneurs. Nearly one in ten U. S. businesses are owned by military veterans. Since these men and women often face special burdens after serving our country, the government has created unique programs to help them find profitable ways to support themselves and provide jobs to others;
  • A course designed for Spanish-speaking young people. Titled Jovenes Emprendedores, this class provides key guidance for those who need business training materials taught and presented in Spanish). There is also a class designed for young entrepreneurs who are native English speakers;
  • Business development class for Native American businesses. Students in this class will learn more about the 8 (a) Business Development Program that’s been specially set up to help many small business owners facing economic disadvantages;
  • Entrepreneurship program for women over 50. Given the high number of seniors now needing to remain in the workforce past normal retirement age, this course is perfect for older women wanting to get new businesses off to a good start. Those who take this course may also want to review the materials designed for the more general WOSB (women-owned small business) Advantage class.

The courses referenced above are just a sampling of the roughly 63 free classes available to anyone who has 30 minutes (or more) to spend mastering these core topics. Should you decide to contact the SBA directly or online, they may be able to provide you with additional online and community resources that can help you get your business off to a promising start.

Please feel free to contact one of our Murray Lobb attorneys while trying to start up a new company – or purchasing one that’s already helping customers. We appreciate the opportunity to help all our clients succeed in all their new business endeavors.

Properly Handling Background Record Checks of Potential Employees

All companies must proceed cautiously while trying to create safe, productive and pleasant work environments. The best approach is to develop standard procedures for running background checks and investigations for all applicants who will be handling similar tasks — without regard to any discriminatory traits or characteristics.

First and foremost, you must obtain each job applicant’s written permission to run checks on their job and educational records, criminal background history and financial credit status. Should any of the information you obtain make you no longer wish to consider a specific job applicant, you must inform that person about each report’s negative findings – since all potential employees have the right to refute and correct such data.

Always be sure to also treat all applicants with equal respect and remind them that you’re simply trying to learn all you can about your top applicants. And be sure to state in writing that providing false information can cause individuals to be immediately dropped from further consideration – or be fired in the future when such misinformation is discovered.

Here’s additional information about the types of errors that can appear in background checks, how you might allow job candidates to respond to negative findings — and tips on exercising special caution when sensitive data appears on either sex offender registries or terror watch lists.

Types of negative information & errors that may be uncovered during background checks

Hopefully, most of your searches will just reveal that your applicants have provided their correct names, full address histories, all job information for recent years, accurate Social Security numbers and other basic data. However, chances are that at least some of your potential employees will need to explain about one or more of the following findings.

  • Past arrests or conviction records. Always pay close attention to the types of behavior or crimes involved, when the events occurred and how (if true) that history might affect your work environment. If you still wish to hire a person with some type of negative arrest or conviction, remember that you have a legal duty to create a safe work environment for all your employees. Also, bear in mind that future claims of negligent hiring could prove very costly to your company.
  • Fraudulent or grossly misleading information about the applicant’s academic background or work history. As noted above, make sure that all your application forms clearly indicate that providing false information on such forms (or on a resume) can be immediate grounds for dismissing an applicant from further consideration. Should you believe that any applicant may have simply made a typographical or innocent error on the forms, always allow the person to provide corrected information. Just be sure to respond to the discovery of such false information in the same manner for every applicant;
  • Misleading or inaccurate driving record information. If you’re hiring someone to deliver packages or goods for you – or drive others around on your company’s behalf, you better make sure they have an excellent driving record.
  • A very poor credit score, a bankruptcy or other signs of major financial problems. Always be sensitive and careful when asking applicants to explain this type of information;
  • The person’s name turns up on a sex offender registry or a terrorist watch list. Given the number of people who are burdened with very common names, always reveal what you’ve learned to the individual in a calm manner, preferably with at least one other human resources staff member present. If you still want to hire a person whose name was on one of these lists, always first speak with your Houston employment law attorney.

Your lawyer can tell you how you should go about carefully determining a person’s correct identity and if it’s too risky to hire someone. It may even be necessary to contact the Department of Homeland Security if the person is listed on a terrorist watch list. (Do keep in mind that even the government knows that it can be very time-consuming to remove a name wrongfully added to a terrorist watch list);

It’s crucial to maintain a standard of fairness that applies to all applicants

Be sure your company’s hiring policies provide specific time limits on when applicants must provide you with corrected information after background checks turn up negative or disturbing information. Always apply that same standard to all applicants. If someone needs more time, you should only allow a one-time extension that applies equally to others.

How long must you keep all job application forms and background check information?

The EEOC (Equal Opportunity Commission), the Department of Labor and the FTC (Federal Trade Commission) each provide slightly different guidelines on how long certain records should be kept. Overall, it’s a good idea to keep a copy of all application materials and background information for about two years. Of course, if any job applicant or employee files a lawsuit against your company, that person’s records should be kept until all legal proceedings and appeals have come to an end.

Make sure all employee records are stored in a restricted area where only one or two senior human resource officials have access to them. Once it’s time to destroy the records, it’s wise to carefully shred, burn or pulverize the data so that the material can no longer be read.

Of course, some employers keep all resumes and job application forms in case they later have problems with an employee — or come across information that indicates that the background check failed to disclose fraudulent claims were contained in those documents. Some firms just scan all such data into secure databases.

Since credit background checks are governed by the Fair Credit Reporting Act (FCRA), be sure you understand the terms of that legislation and how it impacts your specific workplace. Also, always keep in mind that the State of Texas also has laws and regulations that can impact how your company handles background checks and employee records. It’s always wise to periodically touch base with your lawyer to find out if any of these laws have recently changed.

Please feel free to contact one of our Murray Lobb attorneys so we can provide you with the legal guidance you may need while hiring employees or simply running your business. We can also provide you with any contracts you may need — or review the contents of your current employee handbook.

The SBA Suggests 10 Key Steps for Starting a New Business

Once you’ve decided to start a new business, it can be tempting to simply moved forward with various tasks as they come to mind. While this may work for a few entrepreneurs, it’s always best to create an organized plan of action so you won’t waste time and cause problems for yourself that could easily have been avoided.

Fortunately, the SBA (Small Business Administration) provides excellent online materials that can help you plan the most useful way to start a new company – or expand the current reach of an existing one. Here’s a brief review of the ten important tasks that should normally be addressed first as you launch a new business.

The key steps for creating a solid foundation for your new business

  1. Decide where to locate your company. Prior to starting any market research, you’ll need to look at several cities to decide upon the best location for your business. This decision must be partly based on if you’ll be selling goods and services to your customers from a brick-and-mortar storefront or office – or if you’ll just be contacting potential customers on the phone or over the Internet. Be sure to select a location where many well-qualified job applicants live – as well as a city and state with reasonable business taxes;
  1. Develop a reliable market research plan. Once you’re certain about the goods or services your new business will sell, you must conduct market research to verify that there’s a definite need for what you’ll be selling in a specific location. This activity also involves identifying your potential customers and all known competitors; 
  2. Create a viable business plan. Most people starting a new business choose between a traditional business plan or a lean one for a basic start-up company. If you need to borrow money to finance your company, you’ll almost certainly have to provide a lender with a traditional business plan.

The traditional plan is normally very comprehensive – it describes your specific goods and services, provides a mission statement about what you seek to accomplish in the long run and names the initial team of professionals who will be running the company. It also states where the business will be located and how many employees you’ll need to hire. A traditional business plan should also describe the business structure you’ll be using, who will be handling specific tasks – and it should review your market analysis. Initial financial projections or earnings for the company should also be included.

In contrast, a lean start-up business plan may simply describe your goods and services, provide a statement about who will be running the company and state who you believe will be your most likely customers. It should also contain information about how you’ll initially finance the company and where it will be located;

  1. Make sure you have enough initial funding for the company. You and your business partners or advisors must determine how much money you’ll need to start your business. If you cannot raise this money among your business partners, then may have to try and obtain funds from venture capitalists or request a small business loan from a bank or through SBA resources. Other options include raising capital through crowdfunding or other online resources;
  2. Select the best business structure for your company. While many people run sole proprietorships if they’ll be handling all of the major company tasks themselves, others choose between forming such structures as partnerships, limited liability companies (LLCs) — or some type of corporation or cooperative;
  3. Decide upon the best name for your company. It’s a good idea to brainstorm with your partners or investors since you want to try and choose a name that clearly reflects the nature or “brand” of your business – as well as its spirit. Be aware that one of your first tasks will be to make sure the name you select is original and that it’s not already being used by anyone else;
  1. Be sure to register and protect your business name. After you’ve chosen the best name for your company, you’ll need to take steps to protect that name by properly registering it. Keep in mind that you may also need to register any trademark you’ll be using. Since additional ways of protecting your company name may also be required, you should always discuss this topic with your Houston business law attorney;
  2. You must request state and federal tax IDs. You will need to obtain an EIN (employer identification number) for many reasons. For example, you must have an EIN to open a bank account for your company and to pay taxes (among other tasks). Depending on the different states where your company will be operating, you may also need to obtain one or more state tax IDs;
  3. Obtain all required licenses and permits. Your specific type of business activity and where you’ll be working will determine the types of permits and licenses you must obtain, if any;
  4. Be sure to open one or more business accounts for your company. These most often include checking and savings accounts, credit card accounts and a merchant services account. Depending on the nature of your business and its initial size, you may be able to simply start with a checking account and then open other accounts as the need arises.

Please feel free to contact one of our Murray Lobb attorneys for legal advice as you address any or all of the various steps named above while starting a new business. We’ve had the opportunity to help many clients establish a wide variety of successful businesses in the past and are prepared to provide you will all the guidance you may need.

What Types of Deceptive Trade Practices Are Forbidden in Texas?

Too many Texas consumers regularly lose money on purchases due to misleading advertising and fraudulent business practices. When those events occur – especially when large sums of money are involved – it’s often necessary to contact the Consumer Protection Division of the Texas Attorney General’s Office. That division is charged with enforcing the Texas Deceptive Trade Practices Act (DTPA) that’s set forth in the Texas Business and Commerce Code.

A Consumer Protective Division lawyer must then investigate the consumer complaint and decide if any legal remedy like an injunction must be pursued. The wronged consumer should also consider hiring a Houston business law attorney to file a lawsuit seeking Texas DTPA damages from the merchant or company that allegedly violated the DTPA.

Here’s a brief look at those who may want to file these types of complaints and lawsuits, followed by a review of some of the commonly alleged DTPA violations — and the basic types of civil damages available to plaintiffs who win these kinds of cases.

The general categories of plaintiffs under the Texas Deceptive Trade Practices Act

  • The average, individual consumer buying property or goods. When buying a home, a car, indoor furnishings or other personal property, a consumer has the right to complete such transactions without being fraudulently manipulated by false advertising or other schemes that cause the loss of hard-earned money;
  • Those seeking repairs (or other types of service) work. Consumers must be quoted fair and accurate rates. They must also be provided with correct information about the training and experience of those who will be performing the requested services;
  • Individuals or companies seeking to close expensive business transactions, within certain established financial limitations. For example, a person or company seeking to buy a business franchise worth three hundred thousand dollars will usually be covered. However, the Texas DTPA is not intended to cover any business consumer with assets worth more than $25 million or more – or a business entity with $25 million (or more) in assets that’s controlled or owned by another business or corporation that has assets valued at or above $25 million.

Types of complaints and claims often brought under the Texas DTPA

Since highly diverse claims are covered by this statute, the following list only provides a general sampling of the complaints often alleged by consumers.

  • Being sold goods or services that were not actually made by the company that claimed to have created or provided them. In other words, the seller tried to mislead the buyer as to the true maker or provider of what was being sold;
  • Buyers were intentionally misled as to where certain goods or services originated. It’s against the law to sell goods claiming they were grown or made in a specific country when the seller knew that wasn’t true. Likewise, you cannot advertise that certain services will be provided by employees or contractors from one city or region who will be coming from another location;
  • Advertising goods or services as having the approval or sponsorship of specific individuals or groups when that’s a fraudulent claim. For example, you cannot sell certain medical devices and claim they’re backed by the American Medical Association (or a local medical group) when that’s untrue. Likewise, there can be no attempt to claim that the seller had direct ties to another specific company or government entity when that’s a fraudulent misrepresentation;
  • Selling goods or services and saying that they meet certain objective standards (or are made of specific types of materials) when that’s an intentional misrepresentation. For example, a company cannot claim that a couch was made of leather when it knew it was made of Naugahyde. Likewise, a company cannot claim all service personnel have earned specific licensing credentials – or are bonded – when it knows that’s false information;
  • Making purposeful “bait-and switch” sales. It’s a deceptive trade practice to run a print ad (or an online or televised commercial) that states that a store is selling a specific brand of products – or providing a certain grade of service by specially trained personnel – when the seller knows those facts to be false. Likewise, a company cannot claim that highly experienced contractors with over 10 years of experience are being sent to someone’s home to repair a major roof leak – when the actual workers have very little experience handling such tasks;
  • Misleading the buying public as to why certain goods are being sold at a major discount. For example, a merchant cannot claim that an accidental, large shipment of goods came in and they must now be sold at a greatly reduced price – when that merchant is really trying to unload damaged goods on unsuspecting buyers;
  • Selling a car, truck or other vehicle after rolling back the odometer. When a seller has any reason to believe that someone has reset or rolled back an odometer – or has personally done so because that part stopped recording mileage – all such facts must be fully disclosed to each potential buyer;
  • Taking advantage of the buying public after a natural disaster has been formally declared by the state’s governor. The DTPA does not allow anyone to sell goods at excessive or unfair prices, especially after a natural disaster like a flood. Therefore, no store can charge inflated prices for necessities like water, food, fuel, flashlights, batteries or medicine.

While this list isn’t comprehensive, it should provide a clear idea of the types of fraud and misrepresentation that can cause lawyers with the Texas Attorney General’s Consumer Protection Division – and individual consumers — to pursue through DTPA litigation.

Penalties or damages that can be sought for Texas DTPA violations 

As your personal lawyer will tell you, the Texas Attorney General’s public remedies may include different types of injunctions, restraining orders and penalties. Should you file a private lawsuit, the penalties awarded to you can be influenced by whether the wrongful conduct was knowingly committed. When a violation of the DTPA was “knowingly” committed, penalties are sometimes awarded at the level of three times the sum awarded for the economic damages.

If you believe your consumer rights under the Texas DTPA have been violated, you should contact one of our Murray Lobb attorneys. We can provide you with the timely advice you’ll need while we help you decide whether to file a DTPA lawsuit on your behalf.

Is Your Business Honoring All Federally Protected Employee Rights?

Most personnel managers must work hard to keep up with all the federally guaranteed rights owed to employees and job applicants. And when small companies aren’t required to do the same, they should still try to offer all the legal rights referenced below since every office runs more smoothly when employees are treated with respect and granted as many rights as possible. Employers must also be sure they’re upholding all state employment laws that are often more favorable to employees.

Although many federal laws govern various employee rights, there are five specific ones that set the core standards involving discrimination — and provide fairness when addressing worker hours, wages and time off to handle urgent medical needs. All business supervisors and managers can benefit from reviewing the following brief summaries of Title VII, The Age Discrimination in Employment Act (ADEA), the Americans with Disabilities Act (ADA), the Fair Labor Standards Act (FLSA) and the Family and Medical Leave Act (FMLA).

Basic employment standards established by Title VII

Businesses with 15 or more employees must abide by the full provisions of this law. While some might assume that employers with fewer than 15 employees can openly discriminate, lawyers frequently point out that other federal statutes (42 USC Sections 1981 and 1983) still protect ethnic and racial minorities against discrimination. These statutes govern the formation of contracts — and hiring employees always involves some type of oral or written contract.

Title VII strictly forbids all employers from discriminating against anyone regarding all

possible terms and conditions of employment. Therefore, employers cannot discriminate when handling any of the following activities.

  • Recruiting and hiring
  • Training and assigning work
  • Evaluating or measuring work performance
  • Disciplining
  • Promoting and transferring
  • Providing all promised benefits – including those owed after employment ends
  • Discharging

If your office has any questions about these standards, it’s best to contact your Houston employment law attorney to discuss your specific concerns in greater detail.

Employee rights guaranteed by the ADEA

While it may seem like a non-existent problem to younger workers, discrimination against older employees often incurs in many workplaces, especially when workers are nearing retirement when added benefits will likely vest. The Age Discrimination in Employment Act is designed to protect all employees age 40 and older when they work for an employer with at least 20 total employees.

All the basic employer activities listed above (regarding Title VII) must be applied fairly to older workers. Stated differently, the federal government forbids treating younger workers in a preferred manner over older workers who often have both strong skills and highly valuable years of experience.

Rights guaranteed under the ADA to the disabled

When a job applicant or hired employee can demonstrate his or her ability to handle all required job functions – without or without reasonable accommodations – discrimination is strictly forbidden. The ADA defines a disability as a physical or mental impairment that substantially limits any of a person’s major life functions or activities.

Reasonable accommodations should be offered to help the disabled person fully perform all required tasks, unless such adjustments would result in a fundamental alteration or change in meeting the employer’s program needs.

While the ADA has helped many workers, there’s still a need for greater societal change since many employers who can see a job applicant’s disabilities will privately opt to only hire those who don’t appear to have any cognitive or mobility issues.

Rights provided by the FLSA to all employees

The federal government has used the Fair Labor Standards Act to establish basic standards governing worker hours, minimum rates of pay and the handling of overtime hours. However, state law can offer more favorable rights, including a higher minimum wage.

Individual employers often choose to designate workers as either at-will employees who can be dismissed without cause or contract employees who must be provided with just reasons for their dismissal. The U. S. Department of Labor (DOL) states that if a company is a covered “enterprise,” and its workers are not exempt (or contract employees), the company must comply with all the FLSA provisions. Since determining what constitutes an “enterprise” isn’t always straightforward, you may need the help of your employment law attorney to interpret this for you. However, the DOL states that even if a company doesn’t qualify as a covered enterprise, all of its employees may still be protected by the FLSA provisions if their assigned tasks meet “interstate commerce” requirements.

Worker privileges available under the Family Medical Leave Act

This legislation applies to private employers with 50 or more employees working within 75 miles of the employer’s main worksite. To qualify for the extended leave provided under the FMLA, workers must have been employed by the company for at least twelve (12) months prior to making a request — and meet other specific criteria set forth under the law. Employees are supposed to be reinstated to their past jobs (or very similar ones) upon returning.

The FMLA is often used by a worker to care for a very ill, immediate family member or when the covered employee is personally battling a serious medical condition. Great care must be exercised when any worker states that s/he is not yet physically able to return once the full amount of leave allowed has been used (to avoid running afoul of provisions of state disability laws and the ADA.)

If you have any questions regarding how your office should apply any state or federal laws to employee issues, please don’t hesitate to call one of our Murray Lobb attorneys. We can also provide you with legal advice as to how some of these laws may have been recently modified by new Texas statutes.