Legal Rights of Every Business Owner

The rights and responsibilities that people have increase manifold when one decides to start a business venture.

A business owner is going to impact many people around them either directly or indirectly. They are also accountable for the actions and treatment of their customers, employees, colleagues and the community at large.

This might initially sound intimidating, but things get easy once he or she is aware of their rights and responsibilities as a business owner. Whether you have a huge business empire or have just started, you should learn about your rights and responsibilities to others and to yourself. In this article, we will examine the legal rights and responsibilities of a business owner in India.

The rights of a business owner

Like customers and employees, business owners also enjoy their set of legal rights. Keep reading on as we highlight some crucial rights of business owners in India.

1. Expect the best

We no longer operate in environments where business owners have to settle for average performances, whether from employees or consumers. As long as they have documented their expectations or made them clear, they can hold their workforce or customers responsible for not meeting their expectations.

The business owner must make all possible efforts to meet the demands or address the concerns of customers and employees. But what happens when, even after repeated efforts, their motives do not align with the business? The business owners have all the rights to end these relationships and focus on more productive ones.

But there is more to it than that. Business owners also have a right to terminate any professional relationship at his or her will. After all, in this highly competitive world, holding on to a mediocre sales force or customer can hamper the health of the business.

2. The right to refuse service

Every business owner has a right to refuse service to a customer in certain situations. However, they do need to be extra careful that their actions are not taken as discriminatory by the law. A business owner can refuse service on safety grounds when the customer is disruptive, unruly, or abusive with employees.

However, business owners cannot refuse services based on a customer’s religion, race, colour, gender, disability or origin. Whatever the situation is, business owners must ensure that they use their best judgment when it comes to exercising this right.

Whatever the decision, the business owner should have a compelling and clear case of why services were denied to the customers. The reasons should be strong enough to make them successful in case a lawsuit is filed against them.

3. The right to change

Business owners have all the rights to introduce changes to their work policies, products and services. Some changes might be acknowledged, while others might face resistance from employees or consumers.

Ideally, business owners should discuss these changes with all the affected groups before implementation. However, they also reserve the right to implement certain changes without consent or feedback from employees or customers.

4. Freedom of speech

Every business owner has the right to express his or her thoughts and business ideas. They also have the right to reshape organisational policies and culture as it seems fit. However, they must also be careful enough not to force their viewpoints on others.

Engaging in inappropriate conversations in the workplace or with customers can create a bad impression in the market. Last but not least, they must avoid topics that can hurt someone’s feelings or religious sentiments.

5. The right to decision making

Every business owner has the right to make decisions that are in favour of their business. They have  all the authority to make  any decision that can boost the profitability of their business. However, the decisions taken should be ethical and should not harm any section of society.

Apart from this, the business owner can, at any time, make changes to his or her current business strategies. They can also adopt any business strategy that they think will benefit both the business and the consumers.

Although the business owner is the sole decision maker in the business, they should still understand the viewpoints of their employees. He or she should also consider the demands and expectations of the consumers, from their brand.

All these considerations will help them to make  correct and informed decisions. Such decisions can have long-term benefits for the business. It will also help in fostering a healthy relationship with both his or her employees and customers.

6. Responsibilities of a business owner

Rights and responsibilities go hand-in-hand. Every business owner who wishes to enjoy their  legal rights should also be aware of their responsibilities towards different sections of society. Keep reading on as we outline some of the major responsibilities of a business owner.

7. Responsibilities towards shareholders, co-founders and owners

These are the ultimate firms or people who have invested their funds in a business. It is the responsibility of the business owner to give a fair return on every paisa of their investment. This return can be in the form of dividends, appreciation in the share prices, or having a say in business decisions.

Most importantly, it is the primary responsibility of a business owner to stay true to the commitments that were given to their shareholders. They should also keep them updated about the financial status of the business.

8. Responsibilities towards consumers

Consumers are the most valuable and crucial asset for any business owner. It is the responsibility of every business owner to offer top-notch quality products to their consumers. Moreover, the pricing policy should be set keeping in mind the spending capacity of the consumers. Offering high-quality products at affordable prices can boost profitability and build brand awareness in the market.

Business owners should also refrain from releasing misleading, dishonest and fake advertisements to a potential consumer. Lastly, a professional customer care management system should be implemented to handle all consumer requests and complaints.

9. Responsibilities towards employees

Any business, be it big or small, is directly or indirectly dependent upon the workforce associated with it. Therefore, every business owner should make every effort to boost the morale and productivity of their employees.

Apart from this, the business owner should provide a safe and professional work environment along with compensation, insurance and medical benefits. Complying with the Minimum Wage Act and offering equal opportunities to all employees will help create a healthy and happy work environment.

Business owners should follow all the regulations and guidelines laid down by the State and Central government. Moreover, they should offer a fair salary scale to all the employees, on par with current industry standards. Filing income tax returns on time will further help in the development of the economy and the business environment.

10. Responsibilities towards the environment and society

A business is a crucial part of society. It is responsible to work for the betterment and development of society as a whole. A business owner should generate productive employment opportunities for the young generation.

Apart from this, the business owner should also follow environmentally-friendly manufacturing processes. It is his or her responsibility to keep the environment free from air and water pollution. Moreover, they  should also refrain from any unfair and fraudulent business practices.

The bottom line

The prime motive of every business owner should be to offer excellent products and services at affordable costs. They should focus on creating long-term bonds with consumers by following ethical business practices.

They can also take professional help when it comes to understanding legal permits, licences, trademarks, patents and registrations. Finally, any business owner who wants to take the lead in the competition should stay loyal to their stakeholders.

Are you a business owner who wants to excel in the industry? If yes, make sure you are well aware of your legal rights and responsibilities; it will help you in formulating the best marketing and planning strategies in the future. Good luck!

Also read:

1) Where to Get a Small Business License?
2) What is a business loan? How to apply for a business loan?
3) Where to Get a Small Business License?
4) Ease of Doing Business in India -The Challenges & Opportunities