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Are You Planning on Starting a Business in 2017?

Posted by Corey F. Schechter | Jan 12, 2017 | 0 Comments

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Starting a new business can be an extremely rewarding experience, but it is by no means an easy process. There are countless laws and regulations for operating a business, including at the federal, state, county, and even city level. California is not known for having an overly business-friendly environment, which makes it a good idea to consult with your business attorneys before getting your business started.

On January 1, 2017, hundreds of new laws went into effect in California, many of those impacting business owners. It can be difficult to keep up to date with all the new regulations, all while following the legislative progress of additional proposed laws.

A change that will affect many businesses is California's new minimum wage increase. The state's minimum wage for businesses with 26 or more employees has increased to $10.50 an hour from $10. Over the next 5 years, the minimum wage will continue to rise until it peaks at $15 an hour in 2022. Small businesses with less than 26 employees will have until next year before they have to comply with the minimum wage increases.

Some municipalities have gone beyond the state's minimum wage requirements. Here in San Diego, the minimum wage will now be $11.50 an hour, one dollar per hour more than the state's new minimum. Beyond 2019, the minimum wage will be tied to the Consumer Price Index (CPI). Other cities, including Los Angeles and Berkeley also have higher than state-level minimum wages.

Another new law, which goes into effect on March 1, 2017, requires California businesses to make single-user toilet facilities available to all genders. However, this does not apply to multiple stall restrooms which may remain designated for men or women.

Employers should also be aware of new laws affecting equal pay for women and minorities. Employers are prohibited from paying employees of different races or ethnicities at a different rate if they do substantially similar work to other employees. Additionally, employers cannot solely rely on a worker's past salary as a basis for paying male and female employees at different rates if they do substantially similar work.

In addition to following California's new regulations, President-elect Trump has expressed an interest in making significant tax law changes that would affect corporations and business owners across the country. Business owners will have to wait and see what eventual changes go into effect but the biggest change may be to the corporate tax rate.

Trump has proposed reducing the corporate tax rate from 35% to 15%. However, the tax changes may also eliminate many of the deductions businesses are able to take under the current tax code. Trump has also criticized NAFTA and the Trans-Pacific Partnership. Many companies here in California do a lot of business with Mexico and across the Pacific Ocean. Changes to these trade agreements could have a major impact on companies with significant international business.

If you have any questions about starting a new business in 2017, contact Butterfield Schechter LLP. We will make sure you are prepared for success in your future business venture, and stay in compliance with the latest business laws and regulations. Contact our office today with any questions you have on how we can help you and your business succeed.

About the Author

Corey F. Schechter

Corey Schechter practices in the areas of Employee Benefits, Employee Stock Ownership Plans, Pension and Profit Sharing Plans, ERISA, ERISA Litigation, Business Law, Qualified Domestic Relations Orders (QDROs), and Employment and Labor Law.

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