10 Government Regulations That Impact Your Business, Part 2

small business Nov 09, 2021

Every business has government policies and regulations that they need to follow. Unfortunately, the federal government is not required to apprise you of the ones that affect your business. Unintentionally violating a regulation can result in a fine, and even legal issues, so it's critical to be informed.

In our last article, we covered the first five government regulations that impact your business. The five regulations included tax codes, labor laws, licensing and permits, insurance, and data reporting. Here are the next five regulations.

6. Privacy Laws

Business owners who have multiple employees end up collecting a lot of personal information. Names, addresses, social security numbers, and dates of birth are just a few examples. Employers need to take adequate precautions to ensure that information remains private. If an employee's information is disclosed to a third party without the employee's consent, the business could be held legally liable.

When it comes to filming or the use of security cameras, there is a fine balance between employees' rights to privacy and the business's right to safeguard operations. Regulations can vary by state, but generally, businesses can use surveillance as long as employees are notified and aware.

7. Environmental Regulations

Depending on your industry, you may or may not have to worry about the various environmental regulations that exist. Like labor laws, environmental laws are numerous and difficult to track. Some mainly apply to retailers and others apply to manufacturers. Thankfully, the Environmental Protection Agency (EPA) has resources for small businesses to help you understand the policies that may affect you. It's also a good idea to check out state-level policies as well.

8. Advertising Laws

Advertising can be very effective at attracting new clients to your business, but you need to be careful with your wording. If the claims in your advertisements are purposefully misleading or inaccurate, you can get into a lot of financial and/or legal trouble with the Federal Trade Commission (FTC). Any advertisement on your company's website, social media accounts, or Google Ads, must be true and accurate.

Testimonials are a form of advertising because you are using the words of happy customers to draw in more prospective customers. If you publish testimonials, you must ensure to the best of your knowledge that statements in the testimonials are accurate. Intentionally inflated testimonials can be seen as false advertising. Also, always get written permission before publishing a testimonial on your website.

9. Email Marketing and Spam

Email marketing is a form of advertising, but some government regulations, specifically the CAN-SPAM Act, apply specifically to email marketing. Businesses can be fined over $43K for every single email that violates the CAN-SPAM Act, so compliance is crucial. Here are the main requirements under CAN-SPAM.

  • The "To," "From," and "Reply-To" fields, as well as the originating domain and email address, must be accurate. In other words, you can't pretend to be another company. Your recipients must be able to recognize that the email is coming from you.
  • The subject line can't be deceptive and unrelated to the body text. It must reflect the text in the email.
  • Emails must provide your postal address, such as your physical address, P.O. Box, or wherever else you receive mail.
  • Emails must have a clear opt-out option if recipients no longer wish to receive emails from your company. If you receive an opt-out request, you must remove their email from your campaigns within ten business days.
  • If you hire a company to carry out your email marketing on your behalf, you are still liable should they violate the CAN-SPAM Act. Be sure to monitor the emails they send or approve them before they are sent.

10. Antitrust Laws

Every business wants to grow and succeed, but cornering the market or joining other companies may violate antitrust laws. Antitrust laws, enforced by the FTC, exist to protect businesses from being pushed out of their industry and consumers against rising prices on goods. These laws help ensure that fair business competition remains.

One focus of antitrust laws is to safeguard against the formation of monopolies. A business has a monopoly when they dominate their industry and push out any competition. A company that comes to dominate its industry is not necessarily a monopoly. Becoming influential is not illegal; using that influence in a predatory way to push out competition is. Antitrust laws also safeguard against price-fixing, market allocation, and other tainted business practices.

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Dan Ansaldo

Dan is the Head of Content for Skip and has written on numerous topics including business, education, government, history, and more.

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