Regulations Governing Business

Government regulations

Regulations will set stipulations on the wages of your employees, workplace conditions, your company's effect on the environment, and many other spheres of its operation. It's important to remember that while these regulations can seem unnecessary, they are by and large intended to protect either consumers, employees, or the environment from unfair and harmful business practices.

Sources of Regulation

It's often difficult to keep up with the various sources that regulate business today. It can seem like they're coming at you from all directions. Some sources to be aware of include, but may not be limited to:

  1. The Federal Government
  2. The State Government
  3. The City / County Government
  4. Industry Governing Bodies
  5. Contractual Obligations

State and local regulatory agendas can differ greatly from their federal counterparts, so diligence in research is a must.

Common Regulatory Areas

Employment and Labor

Employment and labor requirements constitute the most expansive area of regulations governing business. This segment includes laws pertaining to:

  • Wages
  • Benefits
  • Working conditions
  • Equal opportunity employment
  • Work for non-U.S. citizens

Minimum wage is set by the Fair Labor Standards Act, which is enforced by the Wage and Hour Division. This is an extremely important piece of legislation for business owners to understand.

An understanding of the Employee Retirement Income Security Act is also essential. This law makes sure that full-time employees receive the retirement plan and health care benefits to which they are entitled.

In the U.S., only citizens and those individuals with work visas can be legally employed. A business owner should consult the Immigration and Nationality Act to ensure all regulations are being followed.

The United States Department of Labor provides an extensive collection of resources to help business owners reach compliance with labor laws. The Equal Employment Opportunity Commission is also a great resource for business owners looking to gain an understanding of equal opportunity employment and its ramifications.

Safety and Health

Employers are required to provide a safe and sanitary, hazard-free work environment (as described in the Occupational Safety and Health Act). To ensure that the necessary standards in this area are met, the work environment should undergo frequent inspections and business owners should closely follow the ever-changing regulations.

Regardless of the legal requirements, it is in a business owner's best interest to look after employee morale through building a healthy workplace. The Occupational Safety & Health Administration is a great resource to begin with in order to gain a full understanding of safety regulations.


The impact a business has on the natural environment is regulated on both the federal and state level. Activities that can potentially come into conflict with environmental regulations include:

  • Agriculture
  • Disposal of hazardous waste
  • Activities threatening endangered species
  • Operating a business in the vicinity of a wetland area

The Environmental Protection Agency is responsible for enforcing environmental laws on the federal level, with corresponding state agencies enforcing state laws. Such agencies perform frequent regulatory inspections and can require a business to obtain a permit for certain types of business operations.

The EPA provides a comprehensive resource laying out its regulations as well as a guide catered specifically toward small businesses.


An effective marketing campaign is essential for most businesses to achieve success. However, a business owner must be very careful not to publish advertisements that are untrue, unfair or purposely deceptive.

Advertising regulations range from restrictions on product labels and telemarketing to selling products online. The Small Business Administration provides a list of resources helpful to business owners looking to effectively and safely advertise.


Most small business owners believe antitrust laws only apply to big business -- an attitude that can turn out to be a serious error. Suppose you have a friend who owns another small business in your industry, and you two want to team up to try to win the bidding on a particular project. This is known as collusion and could get you into significant trouble.

Antitrust laws are designed to mitigate anti-competitive activity, and it's vitally important for owners of even very small business to understand what they can and cannot do. provides a nice overview of antitrust regulations for small business owners, and the Federal Trade Commission provides a useful Plain English Guide to antitrust.

Industry Specific Regulations

For multiple reasons, it is of extreme importance for business owners to have a very detailed grasp of the industry in which they operate. Each industry has its own required licenses and permits, its own specific regulations and even intra-industry governing bodies. For instance, the wireless industry has the CTIA Wireless Association.

The Small Business Administration website has a business guide for many different industries that contains information on industry-specific regulations as well as many other subjects.

Create a Culture of Compliance

Laws and regulations that affect businesses can be complex, confusing and burdensome. At the same time, these regulations can protect your business from the unfair practices of others and are designed to positively affect society.

There is no escaping regulating laws and agencies. The best course of action is to develop an in-depth understanding of those that will govern your business and create systems and processes for monitoring your operations. Create a culture of compliance so that you and your employees know nothing but the right way to do business.

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Regulations Governing Business