Free Business Law FAQs | Free Business Law Legal FAQs

What Does The Civil Rights Act Of 1964 (Title VII) Govern?

Mon, 04 Jun 2007 21:51:22 GMT

Title VII prohibits discrimination in employment including public accommodations, governmental services and education. An employer cannot fail or refuse to hire or refuse to promote, fire anybody or discriminate with respect to compensation, terms, conditions and privileges of employment based on race, color, sex, religion or national origin. An employer cannot limit, segregate or classify employees or applicants in any way that would deprive or tend to deprive employment opportunities or that adversely affects the status of an employee because of race, color, sex, religion or national origin.

Who Does The Civil Rights Act Of 1964 Cover?

Tue, 29 May 2007 21:19:00 GMT

Employers with 15 or more employees, affecting commerce, and whose employees have been employed for each working day in each of 20 or more calendar weeks in the current or proceeding calendar year, are covered by Title VII. Title VII applies to all employers, potential employers, unions, employment agencies and joint labormanagement training committees. Title VII, through subsequent amendments, applies to state and local governments, governmental agencies, and political subdivisions. Religious organizations are exempt when based upon religion.

What Administrative Body May Impose Remedies For A Violation Of The Civil Rights Act Of 1964?

Mon, 04 Jun 2007 21:51:22 GMT

The Equal Employment Opportunity Commission (EEOC) administers and enforces Title VII. The EEOC has the power to investigate, litigate and resolve unfair employment practices. The EEOC make take action in a federal district court for appropriate relief and preliminary relief pending disposition of a charge. The EEOC may also issue a notice of a right to sue to the charging party following administrative proceedings.

Whom Does The Labor Management Relations Act Cover?

Mon, 04 Jun 2007 21:51:22 GMT

Generally, the LMRA covers the private sector. Government agencies are excluded. Two exceptions are national banks and mail contractors. Because of this, states have established various labor laws for the public sector. The LMRA does not apply to independent contractors, because they are not considered employees. The LMRA also excludes supervisors and managerial employees under the definitions of the Act, as well as agricultural employees.

What Does The Fair Labor Standards Act Govern?

Tue, 29 May 2007 21:19:00 GMT

The Fair Labor Standards Act (FLSA) sets minimum wage, overtime pay, equal pay, record keeping requirements and child labor standards. As of December 2000, workers covered by the FLSA are entitled to the minimum wage of $5.15 per hour and overtime pay at time and onehalf rate of pay after 40 hours of work in a workweek. States can set minimum wages higher for their state, but not lower. Various minimum wage exceptions apply under specific circumstances.

Whom Does The Fair Labor Standards Act Cover?

Tue, 29 May 2007 21:19:00 GMT

In order for the FLSA to apply there must be an employment relationship between an employer and an employee. An employee, as distinguished from a person who is engaged in a business of his or her own, is one who, as a matter of economic reality, follows the usual path of an employee and is dependent on the business which he or she serves. There are exemptions. Some employees are exempt from the overtime pay provisions, some from both the minimum wage and overtime pay provisions and some from the child labor provisions. Exemptions are narrowly construed against the employer asserting them. Therefore, employers and employees should always closely check the exact terms and conditions of an exemption in light of the employee`s actual duties before assuming that the exemption might apply.

What Does The Labor Management Relations Act (Lmra) Govern?

Mon, 04 Jun 2007 21:51:22 GMT

Four major historical statutes make up what is now known as the Labor Management Relations Act. The cornerstone of the LMRA provides that protected employees shall have the right to form and join unions and bargain collectively. Such employees can engage in concerted activities for their mutual aid or protection. Employees shall also have the right to refrain from unions unless already represented by a union and subject to a union shop provision. The LMRA further provides which actions or inactions will constitute an unfair labor practice by employer and union. The LMRA establishes the process of elections (conducted by the National Labor Relations Board, NLRB), to determine the desires of the employees for representation, and outlines the NLRB`s powers.

What Administrative Body May Impose Remedies For A Violation Of The Labor Management Relations Act?

Mon, 04 Jun 2007 21:51:22 GMT

Because the LMRA was enacted to maintain industrial peace for the benefit of the public, enforcement is geared to be more remedial in nature than punitive. The NLRB has the jurisdiction, but must enforce its decisions and injunctions through the federal courts. Courts have given great discretion and latitude to the NLRB in its interpretations of the Act.

What Administrative Body May Impose Remedies For A Violation Of The Fair Labor Standards Act?

Mon, 04 Jun 2007 21:51:22 GMT

With the exception of certain federal employees, the administration and enforcement of the FLSA is the responsibility of the Department of Labor`s Wage and Hour Division of the Employment Standards Administration (ESA). The FLSA can be enforced by private employee lawsuits or by actions taken by the Department of Labor. The Department of Labor can also seek injunctive relief. Should an employer lose a case in court, employees generally collect back pay and liquidated damages in the amount of back pay (double damages). Attorney fees are also recoverable. Ignorance of the law is no defense for employers. There is a twoyear statute of limitations. There is a threeyear limit if a willful violation.

What Does The Rehabilitation Act Of 1973 Govern?

Tue, 29 May 2007 21:19:00 GMT

The stated purpose of the Rehabilitation Act is to endorse economic independence of handicapped persons. This is done through the employment of people with disabilities and the inclusion of people with disabilities in American life. The Act thus creates the practical mechanisms and funding authority necessary to achieve these goals. The Rehabilitation Act provides that recipients of federal financial assistance are prohibited from discriminating against otherwise qualified handicapped persons solely by reason of their handicap.

Who Does The Rehabilitation Act Of 1973 Cover?

Tue, 29 May 2007 21:19:00 GMT

The Rehabilitation Act covers handicapped persons in the federal government, federal government programs or an employer who contracts or subcontracts with the federal government. A handicapped individual is defined as any individual who has a physical or mental impairment that substantially limits one or more major life activities and either has a record of such impairment or is regarded as having such impairment.

What Administrative Body Can Impose Remedies For A Violation Of The Rehabilitation Act Of 1973?

Mon, 04 Jun 2007 21:51:22 GMT

The Department of Labor has jurisdiction of the Rehabilitation Act. The employee can recover compensatory and punitive damages in cases of intentional discrimination. Punitive damages, however, may only be recovered against private sector employers who acted with malice or reckless indifference to the victim`s rights. Damages are limited to $50,000 for employers 15100, $100,000 from 101200, $200,000 for 201500 and $300,000 for 501 or more.

Can Warn Notification Be Shortened Or Waived?

Tue, 29 May 2007 21:19:00 GMT

Yes, the notification under WARN can be shortened when the employer is actively seeking business or capital which would have enabled the employer to avoid or postpone the shutdown and that the employer reasonably and in good faith believes that giving the notice required would have precluded them from getting that capital or business to avoid the shutdown. The notification period can be waived if caused by circumstances that were not reasonably foreseeable as of the time notice required. Such an employer must give as much notice as is practicable and explain the basis in the notification letter. No notice is required if the closing is due to a natural disaster.

Are There Requirement For The Delivery Of The Notice Under The Workers Adjustment & Retraining Act

Tue, 29 May 2007 21:19:00 GMT

Notice should be given by any reasonable method designed to ensure notice of at least 60 days. Such notice includes first class mail or personal delivery with optional signed receipt. Insertion of notice into pay envelopes is another viable option. A ticketed preprinted notice regularly included in a paycheck or pay envelope does not meet the requirement.

Do The Requirements Under The Workers Adjustment & Retraining Act Apply To An Employer's Subsidiaries?

Tue, 29 May 2007 21:19:00 GMT

WARN`s application to an employer`s subsidiary depends on the degree of the subsidiary`s independence from the parent employer. One must look at such factors as common ownership and common directors and officers, the exercise and control of the subsidiary, dependency of operations and the unity of personnel policies originating from a common source.

What Does The Employee Polygraph Protection Act Of 1988 Govern?

Tue, 29 May 2007 21:19:00 GMT

The Federal Employee Polygraph Protection Act (EPPA) establishes guidelines for polygraph testing and imposes restrictions on most private employers. In general, businesses cannot request, suggest or require any job applicant to take a preemployment polygraph examination. Businesses can request a current employee to take a polygraph examination or suggest to such a person that a polygraph examination be taken, only when specific conditions have been satisfied. Nevertheless, the employer cannot require current employees to take and examination, and if an employee refuses a request or suggestion, the employer cannot discipline or discharge the employee based on the refusal to submit to the examination.

Who Does The Employee Polygraph Protection Act Of 1988 Cover?

Tue, 29 May 2007 21:19:00 GMT

EPPA covers commercial businesses. Exceptions are businesses whose primary purpose consists of providing armored car personnel; and those involved in the design, or security personnel, in facilities that have a significant impact on the health or safety of any state. Also exempt are companies which manufacturer, distribute or dispense controlled substances. Local, state and federal governmental agencies (such as police departments) are not affected by the federal law, nor are public agencies, such as a school system or correctional institution. However, some states have laws that offer greater protections with certain classes that may include governmental agencies.

What Administrative Body May Impose Remedies For A Violation Of The Employee Polygraph Protection Act Of 1988?

Mon, 04 Jun 2007 21:51:22 GMT

Under the EPPA, an individual has the right to take action against a violating employer by filing with the Secretary of Labor. The examinee may recover such legal or equitable relief as may be appropriate, including, but not limited to, employment, reinstatement, promotion, payment of lost wages and benefits, and reasonable costs, including attorney`s fees. Civil penalties may be assessed for not more than $10,000. The U.S. District Court has jurisdiction to issue restraining orders and injunctions. An examinee may bring a private civil action in any Federal or State court of competent jurisdiction. No action may be commenced more than 3 years after the date of the alleged violation. The court has the discretion to allow the prevailing party (other than the United States) reasonable costs, including attorney`s fees.

What Does The Americans With Disabilities Act (Ada) Govern?

Tue, 29 May 2007 21:19:00 GMT

The Americans with Disabilities Act (ADA) prohibits discrimination against qualified disabled individuals in all employment practices including job application procedures, hiring, promotion and advancement, discharge compensation, training and other terms, conditions and privileges of employment. The ADA prohibits employment discrimination on the basis of a disability in all programs, activities and services provided for or operated by state and local governments.

Who Is Covered By The Americans With Disabilities Act?

Tue, 29 May 2007 21:19:00 GMT

The Americans with Disabilities Act (ADA) applies to disabled individuals in employment. The ADA applies to private employers, state and local governments, employment agencies and labor unions. The Act broadly defines a disability as a physical or mental impairment that substantially limits one or more major life activities. The definition also includes anyone who has a record of such impairment or is regarded as having such impairment.

What Administrative Body May Impose Remedies For A Violation Of The Americans With Disabilities Act?

Mon, 04 Jun 2007 21:51:22 GMT

Complaints can be filed with the EEOC or individuals seeking to bring a lawsuit under the ADA must first file a charge with the EEOC and/or with any state or local deferral agency established by a state. Remedies under the ADA include compensation and punitive damages in amounts limited by the size of the employer`s work force.

What Does The Age Discrimination In Employment Act (Adea) Govern?

Tue, 29 May 2007 21:19:00 GMT

It is unlawful for an employer, employment agency or Labor Union to discriminate in employment against anyone because of his or her age. This includes refusing to hire an individual or firing an employee. It also includes an individual`s compensation, terms, conditions or privileges of employment and all employee benefits.

What Administrative Body May Impose Remedies For A Violation Of The Age Discrimination In Employment Act?

Mon, 04 Jun 2007 21:51:22 GMT

Complaints are to be sent to the Equal Employment Opportunity Commission (EEOC) within 180 days of the occurrence of the discriminatory act, unless the alleged misconduct occurred in a state that has an age antidiscrimination agency. If so, charges should be filed within 300 days of the alleged unlawful practice or within 30 days after receipt of notice that the state proceedings have been terminated; whichever is earlier. Any individual civil action may be filed 60 days after a charge has been filed with EEOC or state deferral agency. There is a statute of limitation on lawsuits of 2 years. Three years for willful violations.

What Does The Employee Retirement Income Security Act (Erisa) Govern?

Tue, 29 May 2007 21:19:00 GMT

ERISA was passed to protect the interest of participants in employee benefit plans and their beneficiaries through disclosure and reporting requirements, and the establishment of certain fiduciary standards of conduct, responsibility, and obligations.

Who Is Covered By The Employee Retirement Income Security Act?

Tue, 29 May 2007 21:19:00 GMT

Any employee benefit plan established or maintained by any employer, employee organization or organization representing employees engaged in commerce or in any industry or activity affecting commerce is covered by ERISA. ERISA does not apply to government plans or taxexempt church plans as defined by the Act. Also exempt are plans maintained solely for the purpose of complying with workers compensation, unemployment or disability insurance laws or those maintained outside of the U.S. primarily for the benefit of persons substantially all of whom are nonresident aliens. If a plan is an excess benefit, providing benefits or contributions in excess of those allowable for tax qualified plans, it is exempt from ERISA.

What Administrative Body May Impose Remedies For A Violation Of The Employee Retirement Income Security Act?

Mon, 04 Jun 2007 21:51:22 GMT

ERISA has designated the Secretary of Labor broad powers to investigate and determine violations and impose remedies. The Secretary of Labor, plan participants, beneficiaries or fiduciaries, can bring ERISA actions to U.S. District Courts. Criminal prosecutions may be brought against persons who willfully violate the Act.

What Does The Workers Adjustment & Retraining Act (Warn)(Plant Closure Law) Govern?

Tue, 29 May 2007 21:19:00 GMT

Known as the Plant closure law, WARN requires an employer of 100 or more to give affected employees at least a 60 day written notice prior to any plant closing or mass layoff. This is designed to provide employees and their families some transition time to adjust to the prospective loss of employment, to seek and obtain alternative jobs and, if necessary, to enter skill training that will allow an employee to successfully compete in the job market. WARN further provides for notice to state dislocated worker units so that dislocated worker assistance can be promptly provided. Also, notice is to be sent to local elected officials, so they may prepare a community response. If represented by a union, notice must be given to the Union rather than to the employees.

What Administrative Body May Impose Remedies For A Violation Of The Workers Adjustment & Retraining Act?

Mon, 04 Jun 2007 21:51:22 GMT

An employer can be penalized for failure to give proper notices. These amounts are set for $500.00 per day for each violation, plus paying the affected employee the wages and benefits they should have received. This can be reduced in certain limited circumstances. An action to recover these amounts may be initiated in any federal district court in which a violation is alleged to have occurred or in any federal district court in which the employer transacts business. The Court also has the discretion to award the prevailing party reasonable attorney fees.

What Does The Federal Family And Medical Leave Act (Fmla) Govern?

Tue, 29 May 2007 21:19:00 GMT

The Family and Medical Leave Act (FMLA) allows certain employees up to twelve weeks of unpaid, jobprotected leave per year. The FMLA calls for notification responsibilities. It also requires that group health benefits be maintained during the leave. The FMLA is designed to help employees balance their work and family responsibilities by taking reasonable unpaid leave for certain family and medical reasons. The FMLA also seeks to accommodate the legitimate interests of employers, and promotes equal employment opportunity for men and women. A number of states have also enacted family and medical leave laws, some of which provide greater amounts of leave and benefits than those provided by FMLA. In those situations where an employee is covered by both Federal and State FMLA laws, the employee is entitled to the greater benefit or more generous rights provided under the different parts of each law.

Who Is Covered By The Federal Family And Medical Leave Act?

Tue, 29 May 2007 21:19:00 GMT

Only employers that carry 50 or more employees at a worksite, or within 75 miles, are covered by the FMLA. However, for an employee to be eligible, he or she must have worked for the employer for at least one year and must have worked at least 1,250 hours (an average of 25 hours a week) during the previous 12month period. An employer may deny leave to any key employee who receives a salary in the top 10% of the work force and whose leavetaking would cause economic harm to the employer.

What Administrative Body May Impose Remedies For A Violation Of The Federal Family And Medical Leave Act?

Mon, 04 Jun 2007 21:51:22 GMT

The United States Secretary of Labor, through the Wage and Hour Division of the Employment Standards Administration, has administrative jurisdiction. The Department of Labor will review the merits of the complaint and attempt to negotiate and resolve the complaint administratively with the employer. If the Secretary of Labor is convinced that a violation has occurred, and in the event attempts to resolve the matter with the employer are not successful, the Secretary of Labor may file a lawsuit on behalf of the employee. Complaints are to be filed two years from the date of the last action of the alleged violation. Three years if it is a willful violation. Complaints may be filed by an employee or by any other person on behalf of an employee. There is no federal requirement that the Secretary of State be notified before filing a lawsuit in the event attempts to resolve the matter with the employer are not successful.

What Does The Federal Occupational Safety And Health Act (Osha) Govern?

Tue, 29 May 2007 21:19:00 GMT

The Occupational Safety and Health Act (OSHA) requires that an employer furnish a place of employment free from recognized hazards that are causing, or likely to cause, death or serious harm to employees. OSHA requires certain record keeping and notice requirements on the employer and establishes standards and procedures.

Who Is Covered By The Federal Occupational Safety And Health Act?

Tue, 29 May 2007 21:19:00 GMT

OSHA generally covers any employer engaged in a business affecting interstate commerce that has at least one employee. However, OSHA does exempt certain employers from some requirements and penalties if they have 10 or fewer employees. This Act does not apply to residential owners who employ persons for ordinary domestic household things, such as cleaning, caring for children and cooking, etc. State and local governments are not covered and states have developed their own laws. OSHA encourages states to take on responsibility and enforcement roles. The Act does not prohibit a state agency from enforcing its own OSHA laws as long as the state law does not conflict with the federal law.

What Administrative Body May Impose Remedies For A Violation Of The Federal Occupational Safety And Health Act?

Mon, 04 Jun 2007 21:51:22 GMT

The Occupational Safety Administration of the Department of Labor administers OSHA. Through the Secretary of Labor, the Administration has the power to investigate, inspect, issue citations and impose penalties. Offenders can be subject to civil and criminal penalties. OSHA inspections are to be conducted during working time, or at other reasonable times, and in a reasonable manner. Inspections are subject to the search and seizure safeguards of the Fourth Amendment.

What are the advantages to an LLP?

Tue, 24 Mar 2009 12:35:26 GMT

A Limited Liability Partnership (LLP) has many of the same characteristics as a general partnership. However, there is one important advantage to the LLP business model. If a partnership is formed as an LLP then each partner is only personally liable for his or her own negligence or for the negligence of an employee under that partner’s direct supervision. So, if for example, the partners formed an accounting firm and one of the accountants is found guilty of malpractice then only the accountant who committed the malpractice would be personally liable for the damages that incurred as a result of his actions. It is important to note, however, that this limited liability does not extend to business debts which all partners would share in equally regardless of which partner was responsible for incurring the debt.

What are the advantages to an LLC?

Tue, 24 Mar 2009 12:36:35 GMT

A Limited Liability Company (LLC) is a form of business organization which combines some of the benefits of a corporation with some of the benefits of a sole proprietorship. Owners of an LLC enjoy the limited personal liability for mistakes or misconduct of the business that owners of corporations enjoy. However, LLC owners are not subject to the same tax implications as a corporation. Further, an LLC offers its owners quite a bit of flexibility to determine how the business is going to be managed and how income is going to be allocated among the owners.

Do I need a license / permit to open my business?

Tue, 24 Mar 2009 12:42:01 GMT

That depends on what type of business you own. Many businesses do not need any special licenses or permits in order to operate their businesses. However, some businesses that engage in certain trades or professions may need special licenses. For example, certain professionals such as doctors, lawyers, teachers and accountants need special licenses, issued by appropriate state agencies, in order to engage in the practice of their profession. Also, some businesses that engage in certain types of commerce such as alcohol or firearms may need special licenses in order to operate.

Do I need business insurance?

Tue, 24 Mar 2009 12:42:51 GMT

Most businesses need some kind of insurance coverage. The type of coverage varies from business to business and many companies need more than one type of insurance policy. For example, professionals, such as doctors and lawyers, usually must have malpractice insurance. Businesses that operate vehicles must have motor vehicle insurance. Many businesses also need property insurance to protect against things such as fires or natural disasters. Since most businesses can benefit from insurance and some businesses are required to have insurance, it is important for every business owner to speak with a qualified insurance agent to review the different types of insurance available and which types make sense for a particular business.

Do I need a Taxpayer Identification Number

Tue, 24 Mar 2009 12:43:24 GMT

A taxpayer identification number (TIN) is a number used by the Internal Revenue Service (IRS) to identify people and companies. Most companies need to file with the IRS to receive an Employer Identification Number (EIN). Those who do not need an EIN typically use their social security number unless they fall under a limited exception to the general rule. A business needs to obtain an EIN if the business has any employees, if it operates as any type of corporation or partnership, if it has to file special tax returns for employment, excise or alcohol, tobacco and firearms or if it is involved with certain types of organizations such as estates or non-profit organizations.

How often do I need to pay taxes?

Tue, 24 Mar 2009 12:44:01 GMT

If you operate a business then you will need to pay your federal and state income taxes and your self employment tax at least annually and likely more often than that. If a business expects to owe $1,000 or more in taxes at the end of the year then the business needs to file quarterly tax returns. Other types of taxes such as business entity taxes and excise taxes must also be paid according to the schedule determined by your state taxing authority.

What benefits must I legally provide to my employees?

Tue, 24 Mar 2009 12:44:39 GMT

The type of benefits which an employer must provide to his or her employees depends on the number of people employed by the company and the state(s) in which the company does business. Private employers typically must pay social security taxes for employees and maintain unemployment and workers compensation insurance for employees. Some states also require employers to carry disability insurance for their employees. The Family and Medical Leave Act provides that certain employers with more than 50 employees must provide 12 weeks of unpaid leave in a 12 month period for certain employees who are caring for a new child or a sick relative. COBRA benefits which provide for temporary continuation of health care coverage when an employee is terminated must also be provided in certain situations.

What is equity financing?

Tue, 24 Mar 2009 12:46:14 GMT

Businesses are usually expensive to open and operate and many businesses need investors in order to make the business successful. One way in which business owners can get funds for their business is through equity financing. Equity financing allows people (or other businesses) to invest in the business in exchange for an ownership interest in that company. The investors may be given common stock or preferred stock in the company and, depending on the amount of money they invest, may be given a seat on the board of directors or other decision making body. Since the investors are given an ownership interest in the company, the money which they invest does not need to be repaid by the company. Instead, the investors are entitled to the potential profits of the company in proportion to their ownership interest.

What is debt financing?

Tue, 24 Mar 2009 12:47:02 GMT

Debt financing is a way for businesses to get the capital that they need to open or to operate an existing business. Debt financing is when a person, business, bank or other entity provides capital to a business and the business has the obligation to pay back the principal on that loan plus an agreed upon rate of interest. Many businesses find that debt financing is advantageous because it provides needed capital while allowing the existing owners to maintain ownership and control of the business. Businesses who engage in debt financing may also be eligible for significant tax deductions. However, businesses need to be able to repay their loans according to the agreed upon repayment schedule in order to avoid negative consequences.

I want to do business online. Do I need to charge state sales tax?

Tue, 24 Mar 2009 12:47:57 GMT

Currently, an online seller has to charge sales tax if that seller has a physical location in the state where the online customer is located. It does not matter what type of physical location the seller has in the customer’s state. For example, if you have a warehouse in Pennsylvania, headquarters in Delaware and stores in New York, Florida and California then you need to charge sales tax to all of your buyers from Pennsylvania, Delaware, New York, Florida and California. However, that seller would not need to charge sales tax to a customer from Arizona.

That said, there is a movement to crack down on this often perceived “loophole” and online business, both new and established, should be prepared to possibly start charging state sales tax to all online customers in the future.

How do I register a domain name for my online business?

Tue, 24 Mar 2009 12:49:53 GMT

Registering a domain name, or your website address, is an important step for your business. The first thing that you need to do is come up with a domain name that fits your business and that is not already registered by someone else. Then, you need to go to a trusted website that can register your domain name for you. If you have any questions about the validity of the site with which you are considering registering your name then you might check out the company’s reputation with the Better Business Bureau or seek referrals from other businesses who have established websites.

Do I need to develop terms and conditions for my business website?

Tue, 24 Mar 2009 12:50:31 GMT

Yes, creating and posting terms and conditions for your website is probably a good idea. However, it is important that you think carefully about those terms and conditions and, if possible, have an attorney review the terms and conditions before you post them. This is especially important if you are offering anything for sale on your website. An attorney can help you draft terms and conditions that will benefit you should a dispute arise over a transaction on your website. The terms and conditions can, for example, include a choice of jurisdiction clause that allows you to choose your local jurisdiction for all legal disputes which arise from your website.

How can I collect money that is owed to me by my customers?

Tue, 24 Mar 2009 12:51:08 GMT

It is can be difficult and frustrating to have money that is legally owed to you by customers and not have the customers pay on time. After sending an initial bill and not receiving payment you should follow up with an additional bill marked “Overdue.” Additionally, you should call the customer and remind them of the overdue bill. It is important that you record all of your attempts to collect money from your customers so be sure to make note of the date, time and outcome of each phone call and bill. If your actions still do not result in a paid bill then you may need to hire a collection agency or file a claim in small claims court. Prior to contacting a collection agency or filing a lawsuit, however, you must carefully read the terms of the contract or agreement between you and your customer to ensure that you are pursuing your money in the manner in which you both agreed to prior to the dispute.