This information came from a session during the 2023 ELEVATE conference and expo. Don’t miss ELEVATE in Charlotte, North Carolina, on Nov. 3-6, 2024.
Legal matters typically aren’t top of mind when operating your lawn care or landscape business, but understanding the law can help you tremendously when implementing different policies.
For instance, you may think that the policy of charging team members for damaged equipment, no matter what, is a fair rule, but in 21 states, this is actually illegal. In 18 states, this must be in writing exactly how this process works.
The legal side of your business must be considered as you grow, as it is the foundation you are building on.
Vince Torchia, vice president of The Grow Group, explains that in the law, ‘it depends’ a lot. Whether certain practices are allowed will vary based on your state, city and municipality’s laws. What’s important to understand is ignorance is no excuse and the law comes above your culture, so ‘that’s just how we do it’ is not an acceptable answer.
Torchia adds it’s important to not confuse ‘right and wrong’ with legal and illegal.
The law is all about precedent. Early events are regarded as a guide to similar events going forward. For example, if you didn’t have a policy for maternity leave and you give a mother a month off with pay, you just created a policy whether you meant to or not.
It is important to change your systems and processes as your team grows. Does the PTO policy you offered team members five years ago still work with your structure now?
Contracts/Agreements
Contracts are the backbone of business operations as they establish clear expectations and terms between parties. They also provide legal protection and enforceability.
Some of the essential elements include:
- Offer and acceptance: Parties must mutually agree to the terms.
- Intention to create legal relations: Both parties intend for the contract to be legally binding.
- Consideration: Something of value must be exchanged.
- Legal capacity: All parties must have the legal capacity to enter into the contract.
Some of the common issues that can occur with contracts are when there is ambiguous language that can lead to disputes, failure to specify details which can create confusion and ignoring legal review. Contracts should be reviewed by legal experts. It’s also important to get written documentation, as oral agreements are harder to prove.
HR and Team Member Relations
Policies on sexual harassment, hate speech and employee conduct are all necessary. You should have a reporting process in place at your company.
Depending on the position, you may want to require team members to sign a non-compete or non-solicitation contract. Non-competes limit where a former employee can go to work. They also have a time limit to the restriction. Torchia says the scope of the restriction is harder to enforce as states don’t want to deny someone the right to work.
Non-solicitation contracts have employees agree not to solicit the company’s clients, employees or other individuals with whom the employee worked.
Another legal matter to be aware of is the difference between employees and contractors. There should be a clear distinction between the two. You need to make sure the Department of Labor does not conclude your contractors are actually working as employees.
As a business owner, you need to know when you are responsible for your team. This is known as vicarious liability and is when you are responsible for the actions of your team if they happen within the scope of their employment with you. Torchia says this includes driving to and from work.
While your employee is personally liable for these actions, you can be doubly liable if you knew or should have known how an employee was going to behave.
Torchia says in one case, a commercial account manager for a company was driving home a client from a bar. There was an accident and the driver, who was at fault, was over the legal limit of alcohol and the property manager had to have his arm amputated.
Even though the accident occurred after hours, part of the account manager’s duties was to entertain clients, so this fell within the scope of his employment. The job description included providing rides home after entertaining clients, proving the company could/should have known team members may drive after drinking, so the company was also found liable.
Torchia says the best way to avoid vicarious liability is to have regular safety training and discuss harassment/discrimination matters.
Best Practices
Torchia says being consistent will help you tell the narrative of your company. You should show a pattern of lawful and thoughtful behavior. He encourages that if something happens or you feel something is about to happen, document the process. The more facts you have on your side, the better.
However, overdocumentation can be a problem. Torchia says that courts can sometimes find overdocumentation suspicious.
Keep in mind that once something is digital, it lives forever. There is no wiping something completely clean. If you delete a post, experts can find it and they will know if you tried to hide it.
When you have to terminate an employee, Torchia says this should be done in a way that is the least likely to anger or embarrass them. He says it does you zero good to have someone who is dragging the company down to get caught up in a wrongful termination case.
He says in some cases, having a witness may be appropriate. For long-term employees, offering a severance package can circumvent a lawsuit.
Torchia says the larger your company gets, the more exposure you have. Setting up your processes is always less expensive than a trial.
For more content like this, register for next year’s ELEVATE in Charlotte, North Carolina, on Nov. 3-6.
