Legal ReformOur legal environment is constantly changing and as old legislation evolves and new reforms are considered, there are some laws and regulations that are inadvertently impacting small businesses in the US and abroad. The following four reforms are either in the process of approval or have recently been approved, and they all could have a big impact on small business.

1. Patent Reform In December 2013, the Innovation Act of 2013 was passed with the goal of eliminating “patent trolls,” or people who purchase and enforce patent rights to collect licensing from innovations that they had no part in creating. These patent trolls have no desire to protect intellectual property, but are backed by experienced legal teams that send vague infringement letters and spend big bucks to intimidate small business patent owners. The Innovation Act of 2013 increased costs of patent licensing violation litigations, which aimed to thwart patent trolls. However, in reality these increased costs are negligible for wealthy trolls, but may make it expensive and inefficient for small businesses to protect their patents. The Patent Transparency and Improvement Act proposes to increase transparency in patent ownership, calls for more explicit detail in infringement letters, and requires losing plaintiffs to pay defendants’ legal fees. All of these changes to current patent law would seriously benefit small businesses, but the act was put on hold indefinitely on May 27th, 2014.

2. Canada’s Anti-Spam Legislation (CASL) In 2003, the US government passed CAN-SPAM which applies to the classic junk, advertisement emails. On July 1st, 2014, the Canadian government’s CASL will go into effect. CASL is essentially CAN-SPAM with a wider reach and more severe consequences. It applies not just to emails, but social media, text and phone contacts. It states that people must interact with the company before they can receive marketing messages from that company. Small business owners that have customers in Canada should educate themselves about CASL, and be aware that its stipulations may be the next step in the evolution of current US anti-spam legislation.

3. Paid Sick Leave in NYC A new bill mandating that small businesses with five or more employees must provide at least five paid sick days a year is getting a negative backlash from small business owners in the city, who claim it will have massive costs to small operations that rely on the presence of a limited staff. In passing the bill, New York City is joining Washington D.C., Jersey City, Newark, Portland, San Francisco, and Connecticut, all of which have employee protecting payroll policies. However, there are many other states such as Arizona, Florida, Georgia, and North Carolina that have state laws prohibiting small county or city governments from passing sick leave legislation like that which was recently passed in NYC. Small business owners should review the existing leave policies in their city and state to ensure they are in compliance.

4. Affordable Care Act (ACA) Many small business owners are familiar with the health care changes brought on by the 2010 ACA’s legislation, and are concerned that the changes might affect their bottom line and ultimately their ability to keep their doors open. In fact, 96% of small business owners reported an increase in their premiums within the last five years. The average monthly insurance cost per employee has more than doubled since the ACA’s inception. The ACA stipulates employers with over 50 full-time employees must purchase a company healthcare plan beginning in 2015, and offers tax credits to businesses with fewer than 25 full-time employees. These parts of the legislation have been criticized for discouraging small business growth and hiring. However, in an effort to alleviate the stress that some of the ACA’s provisions have placed on small business owners, the administration has created SHOP, or “Small Business Health Options Programs,” which allows owners to view and compare different packages, collect tax credits and in some cases, apply tax breaks retroactively.

Want to Learn More?

States Revise Laws to Curb ‘Patent Trolls’

7 Things Business Owners Must Know About the Affordable Care Act

How Small Business Owners are Coping With the Health Law

Photo Cred: Duy Khanh, Flickr