The Canal Street Blog

Business-focused legal discussion

Many Startups Are (Unintentionally) Breaking These Wage Laws

Washington State requires all businesses to meet minimum wage requirements. We discuss what they are, possible exemptions, and how to avoid complications.

  Gavin Johnson

Since most startups don’t have a large reserve of cash during their early days, it is common for startups to compensate founders and early employees solely with equity. While this allows startups to conserve what little cash they have, this practice could ultimately be very costly for the company if it runs afoul of wage laws. In today’s post, we discuss various ways that startups may expose themselves (and in some cases their founders, directors, and officers) to liability for violating wage laws, and some steps companies can take to limit that liability.

While the attorneys in our firm do not practice employment law specifically, we come across these issues frequently when working with startups and think it is something founders...

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