Uyen Nguyen – Bringing Entrepreneurship and Law Together

Cultural Sensitivity in Representing Minority Entrepreneurs: A Case Study on Vietnamese Nail Shop Owners

Imagine living in a country where you couldn’t speak the language and navigate everyday life without being able to understand and communicate with others. Now, imagine running a business in that country. How can you navigate the business world with limited English proficiency? How do you understand the law, industry regulation, tax code, finding the right suppliers, building client base, and raising capital?

These challenges do not stop non-native English-speaking entrepreneurs from running successful businesses that generate billions of dollars. Vietnamese American nail salon owners are the epitome of resilience. More than half of all nail salons in America are owned by Vietnamese Americans, mostly Vietnamese women. In 2018, the nail salon industry was worth 8.36 billion dollars. How do women like my mother, whose educational opportunities were limited due to poverty and being subjected to the oppressive conditions of patriarchal society, find their place in America, achieve economic stability, and become players in this lucrative industry?

Link: https://www.nbcnews.com/news/asian-america/vietnamese-nail-salon-workers-backbone-industry-face-triple-covid-19-n1238551

The Importance of Community Networking

The growth of Vietnamese-owned nail shops is due to networking and referrals. By networking with other Vietnamese Americans and being referred for job opportunities, most newly arrived Vietnamese immigrants begin their first jobs in America as nail technicians. For most Vietnamese immigrants, being a nail technician is the fastest path to economic stability in America. Not only are most nail shops owned by Vietnamese Americans, but most nail salon suppliers are Vietnamese Americans. Vietnamese entrepreneurs also dominate the market of nail polishes, tools, equipment, massage chairs, and interiors catering to nail salons. In addition, Vietnamese Americans also run beauty schools that provide training to nail technicians and a streamlined process for nail technicians to obtain licenses. An attorney who understands the crucial role of the community in the nail industry will realize that they can get more opportunities and connect with more Vietnamese entrepreneurs through referrals.

Link: https://hellogiggles.com/grew-up-nail-salon/

Don’t be Surprised When You See a Ten-Years-Old Translating for Their parents at a Business Meeting

Many Vietnamese Americans immediately begin to work as nail technicians as soon as they arrive in America. Due to the massive network of Vietnamese nail-shop owners and the high demand for nail technicians, Vietnamese women have an easier time than Vietnamese men to find jobs when they first arrive in America. Although these women now take on the family’s breadwinner role, they are also deprived of the opportunity and access to pursue higher education or even learn English. Therefore, most of them rely on their children to communicate with native-English speakers. As a result, most immigrant children mature quickly and learn to navigate systems early. It is crucial that an attorney representing limited English proficient business owners can provide interpreting services to their clients. When clients show up with their child as their translator instead of making the parent feel bad, a culturally-sensitive attorney would ask the child to communicate with their parents about the importance of an adult interpreter and rescheduling the meeting to find an interpreter. Most older children, above 13 years old, can effectively translate for their parents. As I mentioned, immigrant children mature at a younger age in comparison to their American-born counterparts because they learn to help their parents at an early age. Although parents should not involve their children in business matters, Vietnamese parents’ mindset is to provide the best opportunities for their children. To do so, some of them have to rely on their children to communicate with others. Numerous private companies provide interpreting services via phone or teleconference. Law firms can enroll in these plans to ensure that their lawyers can best represent clients with limited English proficiency. Attorneys can also take initiative in hiring lawyers or paralegals with diverse and English as Second Language (ESL) backgrounds. Promoting diversity, equity, and inclusion in hiring can generate more profits and expand the law firm’s client base.

There Will be a lot of Cash

There is a lot of cash involved in nail salons, generated from tips and customer payment. In Vietnamese culture, having a large amount of cash is a sign of prosperity and stability. Most Vietnamese Americans are hesitant to use financial institutions. In representing Vietnamese entrepreneurs with a high amount of money, the attorney must communicate with clients that federal law requires a person to file form 8300 with the IRS to report cash transactions of more than $10,000. The attorneys can also advise the clients to understand the potential dangers of possessing a large amount of cash.

Link: https://www.dol.gov/sites/dolgov/files/WHD/legacy/files/NailSalonflyer.pdf

Potential of Misclassification

A lot of Vietnamese nail salon owners get in trouble with the Department of Labor for misclassifying their nail technicians as independent contractors. Classifying workers as independent contractors could potentially absolve the owners from paying employees benefits, retirement pensions, health care, vicarious liability, and unemployment compensation. However, incorrectly classifying workers may expose the entrepreneurs to legal problems such as unpaid employment taxes, failure to pay minimum wage, overtime pay, failure to provide benefits, and violation of anti-discrimination and potential state law. The U.S. Department of Labor has developed a test to determine whether nail technicians are independent contractors or employees. This test ascertains whether the nail technician rents a booth or station at a salon, purchases their own supplies and tools, sets their own schedule and pay rates, has customers pay them directly, and has their own business licenses. In representing Vietnamese entrepreneurs, it is crucial that the attorney recognizes the prevalence of misclassification in this industry and provides clients with candid advice.

Conclusion

Attorneys must continue to educate themselves and evolve as our society changes and becomes more diverse and multicultural. When representing minority business owners, information about their culture will explain their economic behaviors and entrepreneurial mindsets. Cultural sensitivity training will empower attorneys to expand their skill set while allowing them to bring in more clients and make more money.

Words: 960 (Without picture, link, and source page)

Source

https://www.blossomnailspa.net/why-so-many-nail-technicians-vietnamese

https://americanhistory.si.edu/explore/stories/finding-sanctuary-unexpected-place

https://www.statista.com/topics/4624/nail-salons-in-the-us/#topicOverview

https://www.mhanational.org/blog/be-child-immigrant

https://www.refinery29.com/en-us/2023/06/11430532/translators-documentary-children-immigrants#:~:text=From%20a%20young%20age%2C%20children,for%20their%20Spanish%2Dspeaking%20parents.

https://www.americanbar.org/groups/tort_trial_insurance_practice/publications/committee-newsletters/increasing_law_firm_diversity/

https://www.irs.gov/businesses/small-businesses-self-employed/form-8300-and-reporting-cash-payments-of-over-10000

https://www.nailpro.com/business/article/21158154/w-2-1099-heres-what-you-need-to-know-about-your-employment-status

Using Independent Contractors and Outside Firms: Avoiding Employee Misclassification by Kevin P. Hishta, Ogletree, Deakins, Nash, Smoak & Stewart, P.C. with Practical Law Labor & Employment

About the Author

My name is Uyen Nguyen. I am a second-year law student, and I was born and raised in Vietnam. I came to America when I was twelve years old. The first entrepreneur that I know is my dad. He was the owner of a large car dealership in Vietnam. My dad is charismatic, funny, and confident, and whenever he walks into a room, people always notice him. When I think about what an entrepreneur looks like, I think about him. Regarding entrepreneurship, I am passionate about representing POC entrepreneur and building wealth in communities of color. If I could own a business, I would like to own a makeup company. I want to create products incorporating my Vietnamese heritage and promoting Asian beauty.

I want to pursue a career in litigation and become a judge one day. I plan to practice in Pennsylvania after graduation.

Email: udn5006@psu.edu

Tips for Celebrity Entrepreneurs: How to Legally Fight the Consequences of “Bad” Reputation

Creativity and art are not the only ways for celebrities to make profits. Most celebrities make money through entrepreneurship. From creating new products to brand sponsorship and endorsement, most celebrities are entrepreneurs with their own businesses in addition to their creative careers.

While celebrity businesses often generate more profit due to their larger customer base and influence in the market, these businesses face more significant risks if their founders lose popularity or get “canceled.” For example, Hip Hop mogul Sean “Diddy” Combs’s business venture lost its partnership with eighteen companies when he faced sexual assault allegations. Meanwhile, numerous athletes have lost their million-dollar endorsement deals with companies due to their own scandals. For instance, Pittsburgh Steelers running back Rashard Mendenhall tried to remedy his loss of an endorsement deal with Hanesbrand, Inc., by filing a lawsuit alleging the company’s termination of his endorsement as a breach of contract and a violation of his First Amendment right. The endorsement agreement that Mendenhall signed with Hanesbrand contained a “moral clause” that permits the company to terminate the endorsement deal if the athlete is caught in “public disrepute, contempt, scandal, or ridicule, or tending to shock, insult or offend the majority of the consuming public or any protected class or group thereof.” The legal issue is whether Mendehall’s tweet that Osama bin Laden’s death should not be celebrated violates this moral clause. A federal North Carolina District Court judge refused to dismiss the lawsuit and was going to answer this question; however, Mendenhall and Hanesbrand ended up settling the case outside of court.

In reality, most celebrities, when negotiating their deals with brands, often overlook the “moral clause” despite the fact that a violation of such clause could cause them to lose million-dollar endorsement deals. A broad and arbitrary “moral clause” could place celebrity entrepreneurs at a disadvantage because they lack an understanding of the circumstances that would trigger the clause. Under a broad “moral clause,” any allegations of wrongdoings could lead to the termination of endorsement deals. Because we live in a “cancel culture,” celebrity entrepreneurs should spend the same effort in negotiating and drafting the terms of the “moral clause” as they would in negotiating the “salary clause.”

While it is paramount that we set a standard for celebrities and hold them accountable for criminal activities or sexual assault allegations, a celebrity entrepreneur should not face the risk of losing brand sponsorship or retail contracts for their social justice activism. Huda Kattan, the founder of a cosmetic company worth $1.2 billion, faces backlash for her views on the humanitarian crisis happening in Palestine. As an Iraqi makeup artist, beauty blogger, and entrepreneur, Kattan gain international recognition for setting beauty trends and incorporating Middle Eastern makeup style into her products. Because of her view, she has been subjected to public ridicule and called out for being “Anti-Semitic.” Currently, there is a Change.org petition demanding that Sephora, a French retailer of cosmetic products, remove Huda Beauty products from US stores. 31,038 individuals have signed the petition as of today. Although Sephora has not responded, it is not uncommon for retailers to cut ties with influencers amid scandal. In 2020, Cosmetic company Morphe cut ties with Jeffree Star and his cosmetic brand when he was “canceled” for his relationship with another controversial YouTuber.

Celebrity entrepreneurs should leverage their bargaining proposition, such as past endorsement deals and the profit they will generate, when negotiating contracts. They should pay close attention to what kind of behaviors and circumstances will trigger a violation of the “moral clause.” A narrower “moral clause,” such as the contract will be terminated if the celebrity faces criminal charges, is typically preferred by companies. Defining what kind of criminal charges and level of punishment would suffice a violation of the “moral clause” might put the celebrity in a better position. Celebrity entrepreneurs can also negotiate for “Due Process” protection as a part of the morals clause for which they are entitled to defend themselves if a company tries to terminate endorsement deals. In addition, celebrity entrepreneurs could require a company to show a credible finding or incorporate the burden of proof requirement of misconduct when a violation of the “moral clause” is triggered. By carefully drafting the terms of the “moral clause,” celebrity entrepreneurs could protect their economic interests when their reputation is damaged.

In the case of Huda Beauty, if Sephora finds that her support to Palestine is against their points of view, Sephora could terminate the retail contract if it contains a non-disparagement clause. A violation of a non-disparagement clause allows companies to address the actions of celebrities toward their companies. In negotiating the retail contract, celebrity entrepreneurs should pay attention to such a clause, as this clause typically benefits the company.

Entrepreneurs can also prevent the termination of retail contracts with an indemnification clause. The indemnification clause protects a party from losses incurred from another party’s breach, negligence, or misconduct. This clause can function as a tool for damage control when an entrepreneur’s reputation is attacked and prevent the company from cutting ties with these entrepreneurs completely because their losses have been remedied under this clause. However, attorneys should assess an entrepreneur’s reputation and history before suggesting the inclusion of this clause. If the celebrity is a highly controversial figure and has been caught in numerous scandals, then the termination of endorsement deals might be more beneficial to them than paying a massive sum of damages. Generally, an indemnification clause that is too broad and does not clearly state what type of misconduct will be covered is unenforceable.

Celebrity entrepreneurs can also trigger the “liquidated damages” clause when a retail company or brand terminates their contract. Attorneys should pay attention to such clauses because most courts have ruled that liquidated damages clauses intended to serve as a penalty clause or deter individuals from breaching contracts are unenforceable. Courts often do not favor liquidated damages clauses that are arbitrary in terms of damage amount. To ensure the enforceability of such a clause, an attorney must ensure that the clause is intended to remedy the amount of damages that is reasonably expected and calculated if the company terminates its contract with entrepreneurs. To seek legal remedy, celebrity entrepreneurs must show that they have fulfilled their duty to mitigate damages, such as whether they have attempted to find other endorsement deals or contracts with other companies to mitigate their loss. However, once their reputation is negatively impacted, it is less likely that another company would want to work with them. Regardless, celebrity entrepreneurs must fulfill their duty to mitigate in order to recover damages from a breach of contract.

Celebrity entrepreneurs should spend substantial effort in protecting their reputations, and attorneys who represent them should explain the legal consequences of losing their images. One way to minimize loss incurred from a damaged reputation is to include them as many legal protections, such as carefully-drafted moral clause and liquidated damages provision, in the contract during the negotiation phase. Once a celebrity’s reputation is negatively impacted and their career is overshadowed by scandal, their businesses will likely to incur a loss in revenue, and the termination of a retail contract or brand sponsorship will only exacerbate the economic loss. Thus, attorneys can protect clients’ economic and legal interests with creative contract provisions and offering them solutions in terms of damage control.

Source link:

In re WorldCom, Inc., 361 B.R. 675

Space Master Int’l, Inc. v. Worcester, 940 F.2d 16

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https://www.change.org/p/urge-sephora-to-remove-huda-beauty-products-from-us-stores

Image link: https://www.harpersbazaar.com/beauty/makeup/a38746663/huda-beauty-liquid-lipstick-relaunch/