Running a business involves legal responsibilities that can affect its finances, reputation, ownership, and future growth. Contracts, business formation, employment practices, intellectual property, taxes, consumer protection, and licensing requirements can all create legal risks when they are not handled correctly.
A business lawyer can help an owner understand these risks before they become expensive disputes. However, business law is broad, and not every lawyer has the same experience. The lawyer who is right for a local retail store may not be the best choice for a technology startup, construction company, healthcare practice, or growing online business.
Laws can also vary significantly from one state to another. A business practice that is acceptable in one state may create compliance problems elsewhere. For that reason, business owners should seek help from a lawyer who is licensed in the relevant state and understands the federal, state, and local laws affecting the company.
Before hiring a business lawyer, use the following questions to evaluate their experience, working style, services, and fees.
What Types of Businesses Do You Usually Represent?
Begin by asking what kinds of businesses the lawyer regularly advises. A lawyer may work primarily with startups, family-owned companies, professional practices, nonprofit organizations, large corporations, or small local businesses.
Ideally, the lawyer should understand businesses that are similar to yours in size, industry, ownership structure, and stage of development. An early-stage company may need help with formation, ownership agreements, and intellectual property. An established business may be more concerned with employment matters, commercial contracts, expansion, regulatory compliance, or disputes.
Industry experience can be especially important when a business operates in a regulated field such as healthcare, finance, construction, food production, transportation, real estate, or online commerce.
The lawyer does not need to have represented an identical business, but they should be able to identify the legal issues companies in your industry commonly encounter.
How Much Experience Do You Have With My Legal Issue?
Business law covers many different subjects. Some lawyers focus on contracts and business transactions, while others concentrate on employment law, intellectual property, taxes, mergers, compliance, or litigation.
Explain the specific reason you are seeking legal assistance. You may need help forming a company, reviewing a lease, creating a partnership agreement, negotiating a vendor contract, protecting a trademark, hiring employees, or responding to a lawsuit.
Ask the lawyer whether they have handled similar matters and what role they played. They may not be able to disclose client names or confidential details, but they should be able to describe their general experience.
Hiring a lawyer whose experience matches the legal issue is important. Readers can find additional guidance about evaluating legal professionals through Top City Lawyers.
Are You Licensed to Practice in the State Where My Business Operates?
Business laws can vary by state, and some cities and counties impose additional requirements. A lawyer advising your company should understand the laws in the places where you conduct business, employ workers, maintain offices, or sell regulated products and services.
Ask where the lawyer is licensed and whether they regularly handle matters in your state. If your business operates in multiple states, find out whether the lawyer can advise you in each location or will need to work with other local attorneys.
You should independently confirm the lawyer’s license and public disciplinary history through the attorney-licensing authority in the relevant state. Do not rely solely on advertisements, online profiles, or claims made on a website.
Because state law can influence business formation, contracts, employment practices, taxes, licensing, and dispute procedures, seek advice from a properly licensed lawyer before making an important legal decision.
Can You Help Me Choose the Right Business Structure?
The structure of a company can influence personal liability, ownership rights, taxes, management authority, fundraising opportunities, and filing obligations.
Common business structures include sole proprietorships, partnerships, limited liability companies, and corporations. The U.S. Small Business Administration explains that the structure selected can affect taxes, paperwork, fundraising, and personal liability.
Ask the lawyer how they would evaluate the appropriate structure for your business. The answer should take into account the number of owners, the company’s financial risks, future investment plans, management preferences, and state requirements.
A lawyer may also recommend consulting a qualified tax professional. Legal structure and tax treatment are closely connected, but they are not always the same issue.
If the company has already been formed, ask whether the existing structure still supports its current needs. A structure that worked when the business had one owner may be unsuitable after adding partners, employees, investors, or operations in another state.
What Legal Risks Do You See in My Business?
A useful business lawyer should do more than complete paperwork. After learning about your company, the lawyer should be able to identify legal risks that may not be obvious to you.
Possible risks may include:
- Unclear ownership rights
- Missing or outdated contracts
- Improper worker classification
- Inadequate licensing
- Unprotected intellectual property
- Weak data-security practices
- Misleading advertising claims
- Incomplete employment policies
- Failure to maintain required company records
- Agreements that create excessive liability
Ask which risks require immediate attention and which can be handled later. This allows you to prioritize important legal work and use your budget effectively.
Be cautious if a lawyer promises to eliminate every legal risk. No one can guarantee that a business will never experience a dispute, lawsuit, or government investigation. The goal should be to identify foreseeable problems, improve compliance, and put reasonable protections in place.
What Contracts Does My Business Need?
Written contracts help establish what each party is expected to do. They can address payment, deadlines, ownership, confidentiality, termination rights, liability, and methods for resolving disputes.
Depending on the company, important documents may include customer agreements, supplier contracts, partnership agreements, independent contractor agreements, employment documents, confidentiality agreements, licensing arrangements, and commercial leases.
Ask the lawyer which contracts your company should have and which existing agreements need to be reviewed. The lawyer should be able to explain why each document is necessary and what risks it is designed to address.
State law can affect whether certain contract provisions are enforceable. Restrictions involving noncompete agreements, automatic renewals, liability waivers, interest, warranties, and dispute procedures may be treated differently depending on the jurisdiction.
Templates found online may not reflect your business model or the law in your state. Seek a business lawyer’s help before relying on a contract that could affect valuable rights or create a significant financial obligation.
Will You Explain Contracts in Plain Language?
A contract should not remain a mystery after a lawyer reviews it. Business owners need to understand what they are agreeing to, even when an agreement contains technical legal language.
Ask whether the lawyer will explain important provisions in plain language. You should understand:
- When and how payments must be made
- What each party is required to deliver
- How the agreement can be terminated
- Who owns completed work or intellectual property
- What happens if a deadline is missed
- Whether liability is limited
- How disputes will be resolved
- Which state’s law governs the agreement
A lawyer should also identify provisions that are unusually one-sided or inconsistent with the deal you thought you were making.
Before signing an important agreement, ask what the worst realistic outcome could be under its terms. This question can reveal risks that may otherwise be overlooked.
Can You Help Protect My Intellectual Property?
A business may own valuable intellectual property even if it does not consider itself a technology or creative company. Its name, logo, website content, product designs, photographs, software, inventions, marketing materials, and confidential business processes may all require protection.
Ask whether the lawyer handles trademarks, copyrights, patents, licensing, and trade secrets. The United States Patent and Trademark Office provides information about trademarks and federal registration. It also explains the differences between trademarks, patents, and copyrights.
Not every business lawyer handles intellectual property applications or disputes. If the lawyer does not practice in this area, ask whether they can identify potential concerns and coordinate with an intellectual property lawyer when necessary.
It is particularly important to discuss who owns work created by employees, contractors, designers, photographers, developers, and marketing professionals. Paying someone to create work does not always resolve every ownership question. Written agreements can help clarify the parties’ rights.
Can You Advise Me About Employees and Independent Contractors?
Hiring workers introduces legal obligations involving wages, working hours, discrimination, leave, workplace safety, benefits, taxes, and termination.
Ask whether the lawyer advises employers and can review offer letters, contractor agreements, employee handbooks, disciplinary procedures, and termination practices.
The distinction between an employee and an independent contractor is especially important. Simply calling someone an independent contractor in an agreement does not necessarily make the classification legally correct. Government agencies and courts may examine how the working relationship actually operates.
Employment requirements vary by state and sometimes by city. Minimum wages, paid leave, final-pay deadlines, noncompete restrictions, and other workplace rules may be different in each location. Businesses with remote workers may have legal responsibilities in every state where those employees perform their jobs.
Seek advice from an employment or business lawyer familiar with the applicable state before classifying workers or making a difficult termination decision.
Which Regulations Apply to My Business?
A company’s legal responsibilities may depend on what it sells, how it advertises, where it operates, who its customers are, and what information it collects.
Ask the lawyer whether your business needs federal, state, or local licenses. You should also discuss industry-specific regulations, consumer-protection rules, advertising requirements, environmental obligations, and data-privacy responsibilities.
The Federal Trade Commission’s business guidance provides information about advertising, marketing, privacy, consumer protection, and data security. The FTC also explains that businesses should support advertising claims with appropriate evidence.
Government resources can provide helpful general information, but they may not explain how a rule applies to your particular operation. A lawyer can evaluate your activities, location, industry, and customers to help determine which requirements apply.
How Would You Handle a Business Dispute?
Business disputes may arise with customers, suppliers, partners, employees, competitors, investors, or landlords. Ask how the lawyer approaches these disagreements.
Some disputes can be resolved through direct negotiation or a carefully written demand letter. Others may require mediation, arbitration, or litigation. The most appropriate strategy depends on the contract, the amount involved, the available evidence, and the importance of the ongoing business relationship.
Ask whether the lawyer handles lawsuits personally. A lawyer who focuses on transactions may refer litigation to another attorney. If that happens, find out how the referral will be managed and whether you will need a separate engagement agreement.
You should also discuss cost. It may not make financial sense to spend more pursuing a dispute than the business could realistically recover. A good lawyer should consider both the legal position and the practical business outcome.
Who Will Actually Work on My Legal Matters?
The lawyer you meet during the consultation may not perform every task. Other attorneys, paralegals, or legal assistants may complete parts of the work.
Ask who will be responsible for your matter, who will serve as your main contact, and who will make important legal decisions. Find out whether different team members have different billing rates.
Delegating suitable tasks can reduce costs and improve efficiency. However, you should know who is doing the work and how it will be supervised.
If your matter will be transferred to someone you have not met, request an introduction before making a final hiring decision.
How Do You Communicate With Business Clients?
Communication is an important part of the lawyer-client relationship. Ask how the lawyer normally provides updates and how quickly you should expect a response.
Find out whether the lawyer prefers email, phone calls, video meetings, or a client portal. Ask whom you should contact if the lawyer is unavailable and what procedure to follow when an urgent issue develops.
You should also discuss how often you want updates. Some business owners want frequent reports, while others prefer communication only when a decision or approval is required.
Pay attention to the lawyer’s communication during the initial consultation. If the lawyer repeatedly interrupts you, avoids questions, or cannot explain the issue clearly, similar problems may continue after you hire them.
How Do You Charge for Your Services?
Business lawyers may charge hourly rates, flat fees, retainers, subscription fees, or a combination of these methods. The billing arrangement may depend on whether you need help with a specific project or continuing legal advice.
Before hiring the lawyer, ask about:
- Hourly rates for everyone who may work on the matter
- Flat fees and exactly what they include
- Retainer requirements
- Charges for calls, emails, meetings, and document review
- Filing fees and other expenses
- Billing frequency
- Payment deadlines
- What happens if the original estimate is exceeded
Request a written engagement agreement describing the work the lawyer will perform and how you will be charged. Read the agreement carefully before signing it.
Do not choose a lawyer based on price alone. An experienced lawyer who works efficiently and identifies problems early may provide better value than someone with a lower rate who lacks relevant experience.
Can You Estimate the Total Cost?
A lawyer may not be able to guarantee the total cost, especially if the matter involves negotiations, litigation, a government agency, or an uncooperative opposing party.
However, the lawyer may be able to provide an estimated range based on similar matters. Ask what assumptions the estimate is based on and what developments could make the work more expensive.
If you have a limited budget, be honest about it. Ask whether the matter can be divided into stages. The lawyer may be able to address urgent risks first and postpone less important work.
You can also ask the lawyer to notify you before the bill exceeds an agreed amount. Any budget or notification arrangement should be included in writing.
Do You Have Any Conflicts of Interest?
A conflict of interest may exist if the lawyer represents another person or company whose interests differ from yours. This could include a business partner, investor, competitor, customer, supplier, or opposing party.
Provide the full legal names of your company, its owners, affiliated businesses, and other relevant parties. This will help the lawyer conduct an accurate conflict check.
If a possible conflict exists, ask the lawyer to explain it. Depending on the facts and professional rules, the lawyer may be unable to represent your business.
Business partners should not automatically assume that one company lawyer represents each owner individually. Ask the lawyer to identify exactly who the client will be: the business, an individual owner, or another party.
Will You Help Prevent Problems or Only Respond to Them?
Some lawyers become involved only when a business faces a dispute. Others help clients prevent problems through contract reviews, policy updates, compliance checks, and regular legal planning.
Ask whether the lawyer provides ongoing advice and how often the company’s legal documents should be reviewed. A growing business may need to update agreements and policies after adding employees, entering new states, launching new products, or changing ownership.
Preventive legal work can help a company identify unclear agreements, missing protections, and compliance issues before they lead to a claim.
What Should I Bring to the Initial Consultation?
Ask which documents the lawyer wants to review. Depending on the matter, relevant materials may include formation records, contracts, licenses, ownership agreements, policies, emails, demand letters, court documents, and correspondence with government agencies.
Prepare a short timeline of important events and a list of the questions you want answered. Identify any deadlines, upcoming transactions, or financial limits the lawyer should know about.
Be honest about facts that may be unfavorable to your position. A lawyer needs accurate information to evaluate risks and recommend an appropriate strategy.
Also ask whether the consultation creates an ongoing lawyer-client relationship. In many situations, formal representation begins only after both parties sign an engagement agreement.
Warning Signs to Watch for During the Consultation
A lawyer may have strong qualifications but still be a poor fit for your business. Warning signs may include vague answers about experience, unexplained fees, unrealistic promises, poor communication, or pressure to sign immediately.
Be cautious if a lawyer guarantees a particular outcome. Legal matters can be affected by evidence, state law, contract terms, judges, agencies, and the conduct of other parties.
Other concerns include refusing to provide written billing terms, dismissing your questions, recommending expensive action without discussing alternatives, or appearing unfamiliar with the state laws that affect your company.
The attorney-selection principles discussed in this guide are also relevant in other legal areas. For comparison, Top City Lawyers offers a separate resource covering questions to ask before hiring a personal injury attorney.
Frequently Asked Questions
When should a business owner hire a lawyer?
A business owner should consider seeking legal help when forming a company, adding partners, signing an important contract, hiring employees, protecting intellectual property, raising investment, purchasing another company, entering a commercial lease, receiving a legal complaint, or facing a regulatory concern.
Consulting a lawyer before completing a major transaction can help identify problems while there is still time to change the agreement.
Does every business need a lawyer?
Not every routine business activity requires direct legal assistance. However, nearly every business will encounter situations where professional legal advice is valuable.
The need depends on the company’s size, industry, location, workforce, contracts, regulatory responsibilities, and exposure to risk. Because laws vary by state, businesses should consult a lawyer licensed in the appropriate jurisdiction when facing an important legal issue.
Should I hire a general business lawyer or a specialist?
A general business lawyer may be able to handle formation, routine contracts, governance, and everyday legal questions. Matters involving complex taxes, securities, patents, major employment disputes, or litigation may require a specialist.
Ask the lawyer which matters they handle personally and when they recommend involving another attorney.
Can a business lawyer represent both business partners?
Representing multiple partners can create conflicts when their interests are different. The lawyer should clearly explain who the client is and whether joint representation is permitted or advisable.
Each owner may need independent legal advice when negotiating ownership percentages, voting rights, compensation, exit terms, or a partnership dispute.
Is it acceptable to interview several lawyers?
Speaking with more than one lawyer can help you compare relevant experience, communication style, fees, availability, and proposed strategies.
Avoid sharing unnecessary confidential information until the lawyer has checked for conflicts and explained how the consultation will be handled.
Making an Informed Hiring Decision
Before choosing a business lawyer, identify the legal problem, your preferred outcome, your budget, and any upcoming deadlines. Compare lawyers based on relevant experience, knowledge of applicable state law, communication, availability, and written fee terms.
The right lawyer should understand how the legal issue affects the practical operation of your company. They should explain risks clearly, present realistic options, and help you make informed decisions.
Business laws and procedures can differ among states and may change over time. When a decision could affect your ownership rights, finances, employees, contracts, or liability, seek advice from a qualified business lawyer licensed in the state whose laws apply.
This article provides general information about hiring a business lawyer in the United States. It is not legal advice. Business laws and legal procedures vary by state and individual circumstances.
Legal Note: Business laws, licensing requirements, contracts, and regulatory obligations vary by state, locality, and industry. This article provides general educational information and is not legal advice. Before making decisions that may affect your business, consult a qualified business lawyer licensed in the jurisdiction where your company operates.