The Legal Environment of Business - Essay Example

Some of the major cost that is to be paid by the company while launching IPO includes expenses that are incurred for legal services, underwriter’s commission, printing costs, accounting services and personal marketing. Other legal factors include the loss of control, flexibility and confidentiality as all the necessary regulations are governed by SEC after the company gets publicly limited. Dilution of ownership results in disgruntling management. From economic point of view, the company faces a lot of pressure from the unsteady and unstable position of the economy of a country.

When any news regarding the company is revealed on media, it impacts the IPO or share price of the company. Company also faces pressure to maintain and enhance its quarterly earnings as the public invests by verifying the financial position of the company. Several other economic and legal factors affect the company’s decisions while launching IPO. It is necessary to keep all the information into account as any discrepancy can lead to a discounted price of share. Labour Laws and Employment Labour laws can be defined as those laws and regulations that are defined for the employees in order to protect their rights from employer retaliation and reporting the violations to the legitimate authorities.

Employment and labour policies are shaped by the countries in which they operate. However, in most of the countries the employment and labour laws are based mainly on the international standards. Due to this reason, companies do not get much influenced by the labour laws and policies. Yet, it has a certain amount of influence because the laws and policies are not precisely same. Some major criteria that labour laws of every country follow include: Freedom of assembly and speech Protection of right to sue Dues, Fees, Initiation and Assessment When companies start to expand domestically and internationally, they face some sort of discrepancies.

As a company grow, the employee policy manual must grow with it. Simply being aware of what is right or wrong is not enough. Implementing these practices is also vital for the healthy growth of the companies. Fredman (1997) provided comprehensive study on the importance of labour laws in the dynamic and fast changing world. The study provided different perspective of modifications in labour law as per the changing economic and social condition of the country. Should the labour law be refashioned while protecting the worker’s right or should it be flexible enough by removing the employment protection?

In my mind, it all depends upon the condition of the economy of a country and the extent to which it allows labour right protection and employee’s rights. Globalization has caused many companies to expand their business domestically and internationally. Without doing so, it is not possible to for the companies to compete with other companies. Brussels (2006) in his report mentioned the ways of “modernising the labour laws for the 21st centuries”. He stated that the traditional model is not suitable for all workers for adapting change and utilizing the opportunities that are offered by globalization.

(Modernizing the labour laws for the 21st centuries, 2006) A report named as “The employment relationship: Overview of challenges and opportunities, (2006)” showed employment and labour law challenges faced by the company while expanding internationally and domestically. The profound changes that occurred in the work world especially in the labour