Build Your Team

California Law Impacts All Categories of Independent Contractors – Not Just Gig Workers – What Your Business Needs to Do Now

By Jennifer B. Rubin & Audrey Nguyen

The California legislature has now passed AB 5 and, if Governor Gavin Newsom signs the bill into law as expected, California will effectively ban nearly all categories of independent contractors – not just gig economy workers. AB 5 will become effective on January 1, 2020 for all businesses that contract with individuals who perform services in California.

Creating a Board of Directors: Key Considerations for Startup Companies

By Keunjung Cho

One of the most important decisions that a startup entrepreneur can make is creating a board of directors that will assist the entrepreneur in growing and governing the business.  A company’s board of directors is tasked with  overseeing and advising management, making key decisions about the company’s business strategies, and representing the interests of the company and its stockholders.

Five Common Equity Incentive Plan Mistakes

By Sebastian Lucier

Equity Incentive Plans (aka, Stock Option Plans) are a standard feature in nearly every start-up.  Although the basic concept (granting an equity interest to an employee or other service provider) is simple enough, there are a few administrative and legal technicalities that need to be respected.  Below is a list of five common mistakes that start-ups make when administering their Equity Incentive Plans.

How to Distribute Equity in Your Start-Up

By Patrick Elahmadie

One of the most difficult decisions entrepreneurs face when planning the growth of their start-up is determining how to distribute equity among the founders, the current (and/or future) management team and other employees and consultants. There is no one-size-fits-all model for determining to whom to give equity and how much to give them: this process requires an in-depth look at a number of factors pertaining to the company, generally, and the recipient of the equity, specifically. 

New York City Bans Salary History Inquiries

By Alexander Song 

In accordance with a new regulation that took effect on October 31st, 2017, New York City employers are now prohibited from inquiring about or relying on salary history during the hiring process. This ban makes it an unlawful discriminatory practice for an employer, employment agency, or employee or agent of the employer to: (1) inquire about the salary history of an applicant; or (2) rely on salary history of an applicant to determine salary, benefits, or other compensation for such applicant during the hiring process. Employers should revise their hiring processes in order to ensure their compliance with the new law as soon as possible.

Are You An Owner Or Employee? The Inflexibility of the Federal Tax Rules To Be Treated As Both.

By Dan Wilcox and Scott Pinarchick

Over the last twenty years or so, the limited liability company (“LLC”) has become a popular entity choice as a business entity.  An LLC offers a great deal of flexibility in how it is structured and operates, including the ability for its owners to decide to be classified as a partnership, S corporation, C corporation or, if there is only one owner, to be disregarded as an entity for federal income tax purposes.  Notwithstanding the great deal of flexibility afforded to LLCs, the federal tax rules do not permit a person to be treated as both an owner and an employee of a LLC that is treated as a partnership or a disregarded entity.  As a result, owners of these types LLCs who are employees of the LLC should be aware of how both their salary and income are treated for federal income tax purposes. 

A Balanced Approach to Founder's Equity

By Daniel DeWolf and Samuel Effron

When accepting money from outside investors, entrepreneurs are generally asked to give up some degree of control over their start-up, exchanging equity in their company for cash. In an effort to minimize the control they relinquish, upon formation of their company entrepreneurs can grant themselves equity that comes with special rights. 

Why Does a Company Issue Stock Options?

By Daniel DeWolf

One of the critical keys to a successful venture is aligning the interests of the employees and management with the interests of the shareholders/investors. After all, perhaps the greatest asset of a company is its people. Without a competent and motivated workforce, a venture is unlikely to succeed no matter how great an idea or business concept is involved.