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Partnerships and contractor compensation decisions

In a business partnership, there are many decisions to make. Some of these decisions can have big financial implications for a business, and thus major ramifications for all of the partners.

Among these are decisions related to contractors. This includes decisions on what compensation to offer contractors the business is wishing to get the services of. Various things about the specifics of the compensation packages offered to contractors can be very impactful, including:

  • Their size.
  • Whether they involve back-end compensation.
  • Whether they involve a percentage of profits.

So, how the different partners in a business venture act when it comes to contractor compensation decisions can matter considerably. Given this, when in a partnership, there are things a person may want to pay attention to when it comes to their partners to gauge whether there is anything they might need to worry about when it comes to their partners’ decision-making regarding this issue. This includes:

  • Whether their partners act wisely in the handling of their own finances. A person’s habits regarding their personal finances could reflect how they’ll act when it comes to important financial decisions for a business.
  • Whether the types of offers their partners make to contractors are financially wise.
  • If their partners tend to act more generously towards contractors, whether this generosity crosses the line into being financially irresponsible.

Spotting possible problems with one of their business partner’s behavior regarding contractor compensation early could help a person get out in front of the problem, such as working the issue out with their partner, before it erupts into a significant dispute. Other things that could help with preventing disputes related to such compensation from arising within a partnership are partners talking with each other about and working together on contractor compensation matters.

Given the major impacts decisions like contractor compensation decisions can have on a company’s future, when disputes arise between partners over such matters, they can get quite heated and complicated. So, there are a range of pitfalls a person could come across in such disputes. The consequences of missteps in the handling of such disputes can be considerable. Skilled business litigation lawyers can help individuals who are in disputes with a business partner with navigating the many complex aspects of such disputes and fighting for the goals they have for handling the dispute.

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Klein & Wilson
4770 Von Karman Avenue
Newport Beach, CA 92660

Phone: 949-478-0521
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