Companies in Northern California must navigate a complex legal landscape because of the wide variety of local, state, and federal regulations governing small businesses. These regulations exist for many reasons, from protecting the environment to ensuring consumer safety.
However, making sure that your business complies with all these laws can be daunting, and failure to follow them can result in severe penalties, such as stiff fines or even the suspension or termination of your business.
With such high stakes, small businesses need to understand the regulations to make the best decisions for their company. At J.R. Martin & Associates, our team of experts can provide comprehensive education and support regarding all local, state, and federal business regulations.
Local Business Regulations
In California, many cities and counties have their own unique laws that must be followed in addition to state and federal regulations.
For instance, many municipalities require businesses to obtain a business license – an often costly process that can take weeks or even months for approval. In other cases, companies may need to file for permits or adhere to specific zoning laws to operate.
Our team can assist you with this process by providing insightful advice and helping you understand the local regulations that apply to your business, whether they be zoning laws, business license requirements, permit applications, or other matters.
We can also review any paperwork required by the local government and make sure it is filled out correctly, ensuring that your business remains compliant. If you’re operating out of Redding, CA, or the surrounding areas, working with us is the best way to ensure that you comply with all of the area’s local regulations.
California Business Regulations
The state of California is known for having some of the most stringent business regulations in the United States, so it’s important to make sure that your business is compliant.
These include a range of laws that include:
- Employment regulations: California has strict employment rules regarding wages and employee rights that businesses must adhere to to avoid legal repercussions. These include the following:
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- Minimum wage regulations: In 2017, Senate Bill 3 began to phase in requirements to raise the minimum wage every year until January 1, 2023, when it reached $15.50/hour for all employers in California.
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- Overtime regulations: Employers are required to provide overtime pay for all employees who work over 40 hours in a standard seven-day week and more than eight hours in a workday. Additionally, employees who work seven consecutive days in a workweek must also receive overtime pay. These regulations apply to all businesses in the state, regardless of size.
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- Child labor regulations: California has adopted federal standards for most occupations but also has its own regulations that further protect minors under the age of 16. These regulations prohibit them from working in certain occupations, including those involving hazardous machinery, railways, dangerous chemicals, scaffolding, and tobacco.
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- Safety guidelines: According to the California Occupational Safety and Health Act (Cal/OSH Act), employers in California must ensure a healthy and safe working space for all of their employees. This includes developing and implementing an effective Injury and Illness Prevention Program, which must include instruction on best practices for maintaining workplace safety.
- Insurance and liability regulations: Although California businesses aren’t required to purchase liability insurance, there are some other insurance and liability regulations you should follow. Depending on the type of business, other types of insurance may also be required. For example, restaurants and bars must have liquor liability insurance. That being said, the following are a few insurance and liability regulations that are in place in California:
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- Workers compensation: Employers in California must make sure that all employees have workers’ compensation insurance. This insurance is in place to provide benefits to any of their employees who are injured or become sick while on the job.
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- Auto insurance: Businesses in California are required to have auto insurance if their vehicles are registered with the state.
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- Data breach regulations: California has strict data breach notification laws. These laws require businesses to inform customers of any breaches in their personal information. All businesses must comply with these regulations and notify affected individuals within a specific timeframe.
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- Product liability: California has product liability laws in place to protect consumers from defective products. Businesses must adhere to these regulations and recall any products that could harm consumers.
- Tax regulations: California has some of the highest tax rates in the nation, and businesses must navigate a complex system of sales tax, income tax, and employment taxes. Failure to pay these taxes accurately can result in hefty penalties. The following are some of the tax regulations that businesses in California must follow:
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- Sales and use tax: Businesses operating in California must register with the California Department of Tax and Fee Administration (CDTFA) and pay the state’s sales tax, unless specifically exempted by law. Additionally, use tax applies to goods purchased from retailers who are not subject to sales tax, as well as purchases shipped to a California consumer from another state. This includes mail order, telephone, or internet purchases. The sales and use tax rate businesses in California pay is composed of the state tax rate, local tax rate, and any applicable district tax rate.
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- Income tax: Businesses operating as a corporation, partnership, LLC, or sole proprietorship in California are subject to state income tax. The tax rate varies depending on the entity type and amount of taxable income. Additionally, businesses must also pay federal income tax.
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- Employment taxes: Businesses in California with employees must withhold and pay employment taxes, including Social Security, Medicare, and federal unemployment (FUTA) taxes. These taxes fund programs such as Social Security and Medicare, and failure to pay them can result in severe penalties.
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- Property tax: Businesses owning or leasing property in California are subject to property taxes. The amount of tax levied is based on the assessed value of the property and is determined by the county assessor’s office.
- Securities fraud regulations: Any business looking to raise capital through selling securities must comply with strict regulations set by the Department of Business Oversight in California. These regulations include:
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- Blue Sky Laws: California has enacted its own version of the federal Securities Act of 1933, known as the “Corporate Securities Law of 1968”. This law requires businesses to register any securities offered for sale in the state with the Department of Business Oversight. Failure to do so can result in civil and criminal penalties.
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- Anti-fraud provisions: California also has strict anti-fraud provisions in place that prohibit businesses from making false or misleading statements regarding their securities. This includes providing your investors with accurate and timely information about the business’s financial status.
- Environmental regulations: California is known for its strict environmental regulations, and businesses must adhere to various laws regarding waste disposal, pollution control, and other environmentally sensitive practices. Some of the environmental regulations businesses must abide by in California include:
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- The Climate-Related Financial Risk Act: This law requires businesses to report and disclose financial risks from climate change, such as sea level rise and extreme weather events.
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- California Environmental Quality Act (CEQA): This law requires public disclosure of any significant environmental impacts that may result from a proposed project. This includes conducting an initial study, preparing a negative declaration or mitigated negative declaration, and submitting an environmental impact report for review.
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- SB 261 – The Climate-Related Financial Risk Act: This legislation requires all US-based companies with annual revenues over $500 million and conducting business in California to submit reports outlining potential financial risks related to climate change. These reports must be submitted by January 1, 2026, and every two years after that.
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- Proposition 65: This law requires companies in California to provide a warning for any product, workplace, or environmental exposure that contains chemicals known to cause cancer or reproductive harm.
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- Greenhouse Gas Emission Standards: California has set strict greenhouse gas emission standards for businesses, requiring them to reduce their carbon footprint as well as to transition to more sustainable practices.
Our team at J.R. Martin & Associates can provide you with comprehensive guidance on all aspects of California’s business regulations and help you make sure that your company is in compliance. We can also provide assistance with filing the necessary paperwork, such as sales taxes and payroll taxes, to ensure that your business remains compliant.
Federal Business Regulations
Finally, there are numerous federal regulations that businesses must adhere to no matter where in California they’re located, such as the Fair Labor Standards Act (FLSA) and the Americans with Disabilities Act (ADA), to name a few.
You’ll find that many federal business regulations are very similar to the regulations at the state and local levels and cover the same things. However, federal regulations tend to create a minimum threshold, such as the minimum wage, that states and local municipalities can choose to exceed. For example, the minimum wage in California is significantly higher than the federal minimum wage.
At J.R. Martin & Associates, we stay abreast of all the latest changes to federal business regulations so that you don’t have to worry about your company falling out of compliance with these laws. We can provide detailed advice and guidance regarding all federal business regulations.
We Provide Small Businesses With Guidance For Local, State, & Federal Business Regulations
Staying compliant with federal, state, and local business regulations can be challenging for businesses of any size. Here at J.R. Martin & Associates, we are dedicated to providing small businesses with the guidance and assistance they need to operate in compliance with regulations while also advancing their business goals.
We provide comprehensive education and support services for all California business regulations – no matter how complex or nuanced – so that you can make informed decisions about your business. Our team can review paperwork, provide insight into local regulations, and help you navigate the complexities of federal business law.
To discuss how we can help you understand business regulations in California, contact us today to schedule a consultation. With our assistance, you can avoid non-compliance, which can not only result in financial consequences but can also damage your company’s reputation.
Find out how J.R. Martin can help you stay in compliance with business regulations. Request a consultation.
