| |APRIL 20229Furthermore, it makes the employee and its employer aware of the roles, responsibilities and remuneration of the employee and makes both the parties bound by the law. Based on the nature of the work, companies can make dif-ferent types of employment contracts such as Fixed-Term Employment Contract, Casual Employment Contract, Ze-ro-Hours Workers Contract and ESOPS ­ Employee Stock Ownership Plan.Real Estate Agreements & ContractsThere are different types of real estate agreements that are signed and executed between two or more parties. This facilitates a smoother exchange of any property or performing a real estate transaction. Sunil started a cloth-ing manufacturing company by taking a property on lease from his friend and he purchased different machines on hire-purchase arrangement. Sunil failed to make the pay-ment of the machines even after several reminders by the bank. After failing to make the payment for a long time, banks auctioned his machines which further led to the closing of his factory. To avoid such situations in starting up a business, both parties can seek professional legal help and enter into a real estate agreement or contract. The dif-ferent types of real estate agreements involve ­ Hire-Pur-chase Agreement, Lease Agreement and Power of Attorney.Compliances of a CompanyEvery company needs to have a proper legal structure which will prescribe certain rules and regulations for its effective functioning. There are mainly two types of legal compliance regulations. Statutory compliance and Audit Compliance that ensure the proper functioning of an or-ganization. Statutory compliance mainly refers to a num-ber of corporate labour and taxation laws prevalent in the country. The non-compliance of these results in heavy pen-alties and fines. A case happened in 2012 with a construc-tion company that was initially following all the regula-tions of the government regarding taxation and treatment to the employees. Later it started neglecting its employees and it led to an increased attrition rate in the company. Further, due to evasion of tax, an enquiry was done by the Income Tax Department which asked the company to pay heavy fines because of which it faced huge losses.In the same way, a company needs to stay in compliance with external rules, regulations or internal guidelines like corporate bylaws, controls and policies and procedures to prevent future deficiencies.BottomlineFollowing legal processes and compliances is an ongoing process for a business. It can get very difficult for startup founders to gain knowledge about all kinds of corporate law. Thus, the imperative is to appoint a professional law-yer or a consultant for the successful setup and rise of the business. Additionally, specialized lawyers help the found-ers engage in healthy legal practices that further ensure the startup is running proactively on a safe path and can stay away from all possible legal risks. As a startup owner, entrepreneurs work on a tight budget and have even lesser resources to spend on legal needs. However, it is significant for start-ups to appoint or consult a lawyer in the initial stage to avoid any sort of legal crisis in the later stage
< Page 8 | Page 10 >