Protecting Your Liquor License in Times of COVID-19

By: Allyson Lonas

Establishments that serve alcohol need to be mindful of health protocols during Covid-19 and also of the new pandemic-related Liquor License laws. We covered in a previous post,  the rules a restaurant entrepreneur needs to follow in opening an alcohol-serving establishment. In this post, the focus will be on the new pandemic-related laws and the enforcement of them.

governors’ responses to COVID-19 and liquor licenses 

In numerous states, governors and local governments have threatened liquor license repercussions for business owners who do not follow new pandemic-related laws. For example, in New York, Governor Andrew Cuomo stated that any establishment that receives three violations of COVID-19 guidelines would be closed for business. And entrepreneurs living in Pennsylvania need to monitor county phasing to avoid harsh consequences.

When the pandemic began, Pennsylvania Governor Wolf had outlined a reopening plan that included three phases:  red, yellow, and green.

During the red phase, a restaurant could only provide takeout or delivery sales. The service of food or beverages on the premises was not permitted. However, during the yellow and green phase, bar and restaurant owners are allowed to provide takeout and delivery as well as dine-in services, as long as they adhere to the new pandemic-related laws. 

the Pennsylvania pandemic-related liquor laws

On June 18, 2020, the Pennsylvania Liquor Control Board (PLCB) issued guidance to licensed liquor establishments for resuming on-premise alcohol service in counties in the yellow and green phases. A licensee who failed to comply with the requirements could receive citations.  A notice of violation precedes an administrative citation and provides a licensee with time to prepare a defense or the necessary remedy.

Right now, the requirements for those serving alcohol include:

  • Mandating the wearing of masks
  • Providing at least six feet between parties at tables
  • Ensuring that maximum occupancy limits are observed

Occupancy limits are dependent on the restaurant and each owner should be informed on the limit of their establishment.

To ensure directives are being followed, compliance checks will occur unannounced, and the Pennsylvania State Police Bureau of Liquor Control Enforcement will patrol establishments.

If found in violation, your restaurant could incur penalties, including fines and possible suspension or revocation of your liquor license. Even a simple citation could put your business’s liquor license at risk when renewing your application with the PLCB. Therefore, it is essential to stay up-to-date with COVID-19 guidelines and implement any necessary changes to your establishment to avoid losing your liquor license.

other guidelines for entrepreneurs in the service industry 

Other restrictions in place include the prohibition of ordinary alcohol service unless the facility offers sit-down, dine-in meals, or serves take-out sales of alcoholic beverages.

Alcohol may only be served with a meal in the establishment. However, you can serve a cocktail-to-go! On May 21, 2020, Governor Wolf signed House Bill 327, now Act 21 of 2020, to allow the temporary sale of cocktails-to-go from a restaurant, hotel, or bar with a liquor license before 11 pm. The law applies to establishments who have lost twenty-five percent of average monthly total sales during the emergency and will expire when a business reaches 60% capacity and the emergency ends. Cocktail-to-go sizes can range from 4 oz. to 64 oz. But your drinks must be sold in containers with a secure lid and an additional seal is required on the straw opening of a lid. The PLCB provides additional guidelines.

In the restaurant industry, it is encouraged to have a specific COVID-19 prevention plan and to implement it within your establishment. This includes utilizing reservations, using single-use disposable menus, and keeping condiments off the table. Be sure to close or remove amenities that are non-essential to the preparation of food or service. As a general rule, consider including physical barriers between your employees and customers to help keep everyone safe. As a restaurant or bar owner, it is your responsibility to schedule closure periods throughout the day to allow time for cleaning and disinfecting. If you do not follow these regulations, not only will you risk losing your liquor license, but you could lose your entire establishment.

the good news

Over the summer, restaurant and bar owners teamed up and requested the governor raise capacity limits. And on September 8, Governor Wolf announced revised mandates to take effect starting September 21. Indoor capacity restrictions are now increased from twenty-five percent to fifty percent.

If you choose to increase your capacity, you will have to participate in a self-certification process to demonstrate compliance in protecting guests and workers. Participating establishments will appear in a searchable online database and can show that they are following orders through a self-certification process. The Wolf Administration said you should complete the self-certification process by October 5 when enforcement tied to the new seating capacity will begin.  Documents and information can be found on the Open & Certified Pennsylvania program and will contain the following:

  • A list of requirements contained in the current restaurant industry guidance
  • A statement that an owner has reviewed and agrees to follow the requirements;
  • The business’ maximum indoor occupancy number;
  • A statement that the owner understands certification is subject to penalties for unsworn falsification to authorities

Make sure to keep a copy of the self-certification confirmation and you will also be sent mailed Open & Certified Pennsylvania branded materials to display for patrons.

However, there is another caveat to the revised mandates. Any restaurant with alcohol sales whether you decide to self-certify or not will have to cut alcohol sales at 11 p.m and customers will have until midnight to finish their drinks. All previous rules such as serving alcohol only with meals and cocktails-to- go remain unchanged.

Continue to educate yourself…

It is important to follow the stipulations established by your local government and the Centers for Disease Control and Prevention (CDC) to ensure you do not get any citations. We have included a quick link on considerations for restaurants and bars to provide other helpful tips and to reduce the spread. It is vital to abide by these guidelines so your operation can continue, and you can keep your liquor license.

…or else

It is important to follow these mandates because compliance checks are occurring. There is even an online state complaint form to submit a complaint about a business not complying with COVID-19 mandates.

Since the beginning of July, over a thousand compliance checks have occurred in the Commonwealth of Pennsylvania. Citations and warnings were given throughout the state relating to COVID-19 mitigation efforts. Since July, 44,184 compliance checks have been performed to check for social distancing, masks, and requirements of the liquor code. The mandated guidelines should be followed at all times to avoid losing your liquor license. These guidelines are changing daily, so continue to inform yourself! Adhering by the guidelines protects your liquor license. And protecting your liquor license protects your establishment.

 


Allyson Lonas, at the time of this post, is a rising second-year at Penn State Dickinson Law. Originally from Johnstown, Pennsylvania, Ally attended The Pennsylvania State University for her undergraduate degree and has interests in corporate law, antitrust law, and government law. In her free time, pre-COVID-19, she enjoyed traveling.

 

 

Sources:

https://www.psp.pa.gov/COVID-19/Pages/Enforcement.aspx#LCE

https://www.cdc.gov/coronavirus/2019-ncov/community/organizations/business-employers/bars-restaurants.html

https://www.governor.ny.gov/news/governor-cuomo-announces-new-regulations-bars-and-restaurants-ensure-compliance-state-social

https://www.cdc.gov/coronavirus/2019-ncov/community/organizations/business-employers/bars-restaurants.html

Responding to COVID-19

https://www.governor.pa.gov/covid-19/restaurant-industry-guidance/

https://www.governor.pa.gov/plan-for-pennsylvania/

https://www.cdc.gov/coronavirus/2019-ncov/if-you-are-sick/end-home-isolation.html

Photo Sources:

https://www.bing.com/images/search?view=detailV2&ccid=6Fl00GN4&id=74D2D1DF5C386143CA04DB6FFF26B39639B4ED5F&thid=OIP.6Fl00GN4PJB5H_qcFc-TlAAAAA&mediaurl=https%3a%2f%2fs.yimg.com%2faah%2fyhst-12533177228474%2fcovid-19-safety-sign-notice-please-wear-a-face-mask-aluminum-14-x10-10-pack-safety-acc-mppa832va-14-8.gif&exph=560&expw=400&q=covid-19+stop+wear+mask+sign+restaurant&simid=608022353951721346&ck=CB11A2E1104DFC86C5264EF9CC01C8D8&selectedIndex=3&FORM=IRPRST&ajaxhist=0

https://www.bing.com/images/search?view=detailV2&ccid=YpagNukb&id=66DDC2F632DA586AEAC3CAAF7028580203B690C8&thid=OIP.YpagNukbg7kD3e0taiq28gHaFj&mediaurl=https%3a%2f%2frapidosigns.com%2fmedia%2fcatalog%2fproduct%2fcache%2f1%2fimage%2f650x%2f040ec09b1e35df139433887a97daa66f%2ft%2fa%2ftake_out_sign_09.png&exph=375&expw=500&q=restaurant+covid-19+signs&simid=608026945183352390&ck=9D545AC4D1BADCE2BC5F5E914091C967&selectedIndex=28&FORM=IRPRST&ajaxhist=0

https://www.bing.com/images/search?view=detailV2&ccid=rSE1zjII&id=64AC00241AC9A9C27E37382EDDF4013BF7045E85&thid=OIP.rSE1zjIIFNE1jphrKk23gwHaD4&mediaurl=https%3a%2f%2fwww.motherjones.com%2fwp-content%2fuploads%2f2020%2f03%2fblog_carls_table_closed.jpg%3fw%3d1200%26h%3d630%26crop%3d1&exph=630&expw=1200&q=Covid+19+Restaurant+Signs&simid=608002408119667796&ck=8BEF4460BA795910CDB12D1F67FACE7B&selectedIndex=18&FORM=IRPRST&ajaxhist=0

 

 

 

The War on Drug (Testing): Creating Your Company’s Drug Testing Policy

By: Aaron Holland

So, you have started a new venture, or you are expanding your current business to include new employees. That is great news! Now it is time to start deciding how you are going to take care of those employees:  healthcare, paid vacation time, and policies that keep you, your employees, and your business safe, secure, and in compliance with all necessary and applicable laws. You may be considering a drug-testing policy to keep employees safe on the job and your business needs in check. Or, you might not want a testing policy but may be in a field that requires one.

Who needs a policy?

There is no federal requirement for the majority of private employers to have a drug-free work environment. Many states, including Pennsylvania, do not have a general drug-testing requirement. However, some states and even local governments do have testing requirements and guidelines that must be followed. Make sure to check with your locality on any guidelines.

Many industries are also subject to drug-testing requirements. For instance, all employees and contractors that work with the Department of Transportation, the Department of Defense, and the Nuclear Regulatory Commission have mandatory specific testing requirements. Safety-sensitive industries, such as trucking, railroads, mass transit, and other transportation industries, are also subject to testing requirements laid out by the Omnibus Transportation Employee Testing Act (discussed below.) Receiving federal funding for a business or project might also subject your company to testing requirements. But outside of these required policies, it is up to you to determine if you need or want a drug-testing policy.

when should i test employees?

Drug-testing in the workplace usually hinges on something occurring: an offer of employment, an incident, a reasonable suspicion, or time elapsing. These four scenarios are the most common drug-testing occurrences, and each comes with their own considerations.

Pre-employment testing is standard in many industries, especially those involving the operation of equipment. If you want a drug-free workplace, this is a viable option. It is important, however, to constrain this policy to only testing after a conditional offer of employment is extended, and not as a condition of applying.

Post-accident testing is the most common drug-testing scenario because it is directly related to the safety of individuals in the workplace. This testing follows a workplace accident or injury. These tests, if part of your policy, should be limited only to incidents where there is a reasonable possibility of drug use as a factor for causing the incident.

Reasonable suspicion testing is the most difficult type of testing to justify. Reasonable suspicion testing hinges on observations from other employees or customers that elicit someone to believe an employee is under the influence of drugs. Those observations may include a notable change in speech and behavior in the workplace. These tests must be administered quickly and without prejudice to provide accurate results.

Periodic or Random testing is self-explanatory. Many industries believe random or periodic testing is beneficial to keep a drug-free workplace. The key with these tests is to be quite clear that the tests are completely random in their assignment and not prejudicial in any way in who is selected or when the person is selected for testing.

what guidelines are there?

There are five major laws that govern what can and cannot be part of your business’s drug-testing policy.

Title VII of the Civil Rights Act of 1964 prohibits discriminatory practices by an employer on the basis of race, religion, sex, color, and national origin. This includes inconsistently testing certain employees on any basis. Without having a strict written policy and effectively training management, your business could be subjected to a Title VII discrimination suit if an employee feels she is being tested unfairly on such a basis.

Drug-Free Workplace Act of 1988 focuses on federal contractors and provides certain regulations for drug-testing policies. This law requires any business that receives $100,000 or more in a federal contract or single grant to test employees for drug use.

Title I of the American Disabilities Act of 1990 (ADA) prohibits employers from discriminating against qualified individuals with a disability. A drug-testing policy should include an allowance for prescribed medications, and managers should inquire about prescribed medications before termination after reviewing a positive drug test.

Regulation from the Occupational Safety and Health Administration (OSHA) includes reporting procedures for occupational injuries and illnesses. The regulation focuses on providing employment that encourages the reporting of injuries. OSHA explains that a post-incident drug-testing policy should only be done if there is a reasonable possibility that drug use was a contributing factor in the incident.

The Omnibus Transportation Employee Testing Act is a federal regulation that provides requirements for safety-sensitive industries. The main focus here is transportation industries, including aviation, railroads, and trucking. Most of these industries are regulated by federal agencies that create these drug-testing requirements, such as the Federal Aviation Administration. If your business falls under one of these industries, you must follow the guidelines set by the individual agencies that govern.

what else does my policy need? 

Every drug-testing policy should have robust intervention statements that allow leave for those employees suffering from substance abuse so they may receive treatment. These statements can be part of your drug-testing policy or part of your injury and illness prevention program. Under the ADA, an employer also may not fire, refuse to hire, or refuse to promote any individual who has a history of substance abuse or who enrolls in a treatment program. These statements should be made clear in a drug-testing policy.

And remember, training for all supervisors is a necessity to be proactive in testing policies and to avoid potential lawsuits from discriminatory testing practices.

Lastly, the policy needs to be specific and refrain from being too broad or providing for “blanket” testing when it is not warranted or needed. Every employee should feel secure in knowing when she will be tested, even if it is at random!


Aaron Holland, at the time of this post, is a 2L at Penn State Dickinson Law. He currently serves as Event Coordinator for the Federalist Society and is interested in entrepreneurship law and litigation. Aaron is a devoted husband, father of a one-year-old daughter, and a United States Marine.

 

Sources:

Occupational Health & Safety, https://ohsonline.com/

Create your Own Drug and Alcohol Testing Policy, American Alliance Drug Testing (2016), https://aadrugtesting.com/services/create-your-own-drug-alcohol-testing-policy/

Federal Laws and Regulations, Substance Abuse and Mental Health Services Administration (Aug. 4, 2020), https://www.samhsa.gov/workplace/legal/federal-laws

https://www.eeoc.gov/

https://www.osha.gov/recordkeeping/finalrule/index.html

Photo Sources:

https://www.industryweek.com/operations/safety/article/21977986/osha-reporting-rules-discourage-use-of-mandatory-postaccident-drug-testing

https://transportation-services.regionaldirectory.us/

 

Occupational Licensing Reform in Pennsylvania: How Act 41 of 2019 is a Good Start

By: Andrew Ford

Somewhere between one-fifth and a quarter of all jobs in the United States require some sort of occupational license. By contrast, in the 1950s, only five percent of jobs required occupational licenses. Because occupational licensing takes place at the state level, different states can have vastly different standards for licensing. Additionally, some of these licensing requirements seem to be little more than arbitrary barriers to entry into the workforce, and licensing entities are often comprised of individuals who benefit most from barriers to entry in the workforce, raising antitrust concerns.

Pennsylvania Act 41 of 2019

Luckily, there is a continuing national, bipartisan movement to streamline occupational licensing generally, with the greatest momentum to make it easier for would-be employees to enter the workforce and easier for would-be employers to hire said employees. Pennsylvania, for example passed Act 41 of 2019, allowing licensees from other states to obtain “licensure by endorsement” in Pennsylvania without having to restart the licensure process in Pennsylvania, so long as the latter state’s licensure requirements are “substantially equivalent or exceed the requirements established in” Pennsylvania. Additionally, Act 41 allows state licensing boards to award provisional licenses to licensees from states with less stringent requirements than Pennsylvania while provisional licensees are working toward meeting the full requirements to obtain a Pennsylvania license.

In short, Act 41 provides a pathway for an entrepreneur-manager to recruit employees from out of state, while allowing an owner-operator to locate more easily if they or their spouse are forced to relocate due to circumstances. This can be especially helpful for military families.

requirements for licensure by endorsement under act 41

Despite extending parity to out of state licensees, Act 41 does not create a shortcut around Pennsylvania’s licensing requirements, as workers must still satisfy four conditions in addition to the requirement that the latter state’s licensure is substantially equivalent or exceeding the Pennsylvania requirements.

The first of these additional requirements is that the putative licensee must demonstrate competence in his or her field through standards determined by the licensing board or commission, including having completed continuing education in the field or having experience in two of the five years proceeding an application under Act 41. Following the effective date of Act 41, licensing boards and commissions received 18 months to promulgate rules to implement Act 41’s requirements.

The second additional requirement is that the applicant has not committed an act that would result in “refusal, suspension, or revocation” of a license unless the licensing board or commission decides that such an act “would not be an impediment” to granting a license.

Similarly, the third additional requirement is that the applicant is in good standing in the jurisdiction that issued their initial license, but the licensing body again has the discretion to grant a disciplined applicant a license by endorsement notwithstanding.

The fourth and final additional requirement is that the applicant pays any fees necessary to achieve licensure in Pennsylvania.

Generally speaking, the policy aims of Act 41 appear to be to empower licensing boards and commissions to have the discretion to grant the broadest possible relief to workers. This is evidenced by the fact that state licensing boards and commissions have the discretion to grant exceptions in two of the five requirements for licensure by endorsement. Also notable is the fact that there is no requirement that an out of state licensee seeking licensure in Pennsylvania move to Pennsylvania or begin working Pennsylvania before seeking a Pennsylvania license. This allows a Pennsylvania-based entrepreneur to recruit workers from out of state, allowing an out of state licensed employee to seek licensure by endorsement or a provisional license, increasing an employer’s geographic reach in hiring. It also reduces the startup time for an employee who comes into Pennsylvania without being recruited, making Act 41 a law that is beneficial for both management and labor.

more reforms in the works?

Source: Pennsylvania Governor’s Office

Pennsylvania Governor Tom Wolf has made occupational licensing reforms a priority of his administration. In addition to signing Act 41—a crucial first step—Governor Wolf has proposed a variety of changes, including eliminating licensing requirements in 13 different professions including barbers, repealing an automatic ten-year ban that 13 different state licensure boards have on granting licenses for people with drug felony convictions, reducing training and education requirements to more manageable levels, and speeding up the licensure process to require processing of applications in ten days or less absent extenuating circumstances. Of course, these are all proposals, and still subject to the political process, but the momentum toward fewer barriers to work and hiring is a positive step that should be celebrated by business owners and workers alike.

The purpose of this blog post is to summarize the very exciting changes underway in Pennsylvania as a result of Act 41 and other Pennsylvania legislation. Before making any business decision with significant regulatory consequences, such as hiring workers or seeking to assist a worker with licensure burdens a business owner should seek the sound legal advice of an attorney licensed to practice in Pennsylvania. This blog post is not legal advice nor is it a proper substitute for legal advice.

This post was originally written on March 18, 2020.


Andrew Ford is a recent graduate of Penn State’s Dickinson Law and currently working as a Judicial Law Clerk at the U.S. Department of Justice, Executive Office for Immigration Review in Falls Church, VA.

 

Sources

  1. Aaron Edlin & Rebecca Haw, Cartels by Another Name: Should Licensed Occupations Face Antitrust Scrutiny?, 162. U. Pa. L. Rev. 1093 (2014)
  2. Act of July 1, 2019, No. 41, 2019 P.L. 292 (2019).
  3. Ryan Nunn, The Future of Occupational Licensing Reform, Brookings, (Jan. 30, 2017), https://www.brookings.edu/opinions/the-future-of-occupational-licensing-reform/
  4. Edward Timmons, More and More Jobs Today Require a License. That’s Good for Some Workers, but Not Always for Consumers, Harv. Bus. Rev. (Apr. 26, 2018), https://hbr.org/2018/04/more-and-more-jobs-today-require-a-license-thats-good-for-some-workers-but-not-always-for-consumers
  5. Press Release, Pa. Governor Tom Wolf, Governor Wolf Proposes Job Licensing Reform to Cut Red Tape, Strengthen Workforce (June 14, 2018), https://www.governor.pa.gov/newsroom/governor-wolf-proposes-job-licensing-reform-cut-red-tape-strengthen-workforce/

Dr. Roshawnna Novellus | Entrepreneur of the Month | September 2020

By: Ashli Lyric Jones

The key to running any successful business begins with access to capital. Capital can come from a variety of sources such as friends, family, financial institutions, online lenders, credit card companies, insurance companies, and federal loan programs. According to research done by American Express, although Black women are starting businesses at the fastest rate of any racial group, Black women are more likely than their non-minority peers to identify access to credit as a challenge.

Dr. Roshawnna Novellus, Founder & CEO of EnrichHER, saw the lack of economic power of women as one of the biggest issues plaguing the United States. She founded EnrichHER, a platform that allows funders to provide capital to underinvested, small business owners across the United States, such as companies led by women, Black founders, and people of color.

Dr. Novellus holds a Doctor of Science in Systems Engineering from George Washington University, a Master of Science in Information Technology emphasizing Information Systems Engineering, a Bachelor of Arts in Business Management Economics, and a Bachelor of Science in Computer Engineering, achieving Summa Cum Laude in all. She decided to use her skill sets powering solutions to decrease the gap in power that exists. Dr. Novellus’s goal to reduce the gap in power has led her to transition from working in the financial advisory side of business to leading community engagement and advocacy, and now creating solutions for access to capital.

After seeing the gap in the marketplace for women business owners, Dr. Novellus decided she wanted to be not only a part of the community that highlights attention to this problem but also a part of the community that provides a solution. EnrichHER is a combination of everything that Dr. Novellus has learned over the past ten years from her corporate and entrepreneurial endeavors.

“Everything you do is based on your past experiences and I model what we do based on what I feel makes people the most comfortable, safe, and the most creative.”

As a company, EnrichHER is flexible and provides a work-life balance to employees. Dr. Novellus runs EnrichHER with an understanding of the outside factors that may occur in her employees’ lives because the team is about 90% women, and about 50% of them have children. When it comes to training, Dr. Novellus leads her team through developing skills such as being a leader in every situation, despite the circumstances. Find more about the opportunities through EnrichHER.

What challenges do you face as a black woman entrepreneur?

“When you have a job at a consulting firm with a big title people assume that you have something going for you, whereas an entrepreneur, most people think you’re an entrepreneur because you can’t do anything else or you can’t get a job.”

As a Black woman entrepreneur, Dr. Novellus often must deal with marginalization. The level of trust and faith that she receives when she is interacting with people individually is reduced significantly than when she was leading teams at big organizations. Despite her impressive credentials, people rarely give her the benefit of the doubt because she is a Black woman. People often assume that she needs someone else on her team to validate her. Such experiences have driven Dr. Novellus to help people in underrepresented communities.

Is there anything in your background that shaped who you are today as an entrepreneur? 

“Often we are not provided options that are really made for us.”

Both of Dr. Novellus’s parents were entrepreneurs, which allowed her to become familiar with the concept of entrepreneurship. While working as a consultant, Dr. Novellus would often have conversations with her mother about her goals and visions for the future. Her mother would often tell her that she is supposed to become an entrepreneur. After discovering that she did not have the continued desire to work for anyone else, Dr. Novellus decided to follow in her mother’s footsteps and start her own business.

While working in both corporate and academia, Dr. Novellus realized that most of her co-workers all had the same issues when it came to their finances: lack of understanding and lack of empowerment. She would help her co-workers with their 401(k)-retirement plan investing, assist them with the closing of their houses, and help build their confidence so they could make critical financial transactions. These interactions helped her form the idea to help people when it comes to financing and raising capital.

In the past, Dr. Novellus has had experiences where she felt excluded or felt like things weren’t designed for her as a Black woman. For example, while working for a technology company in New York, she was one of the few members on her team that only spoke English. Since the other team members solely spoke another language, that was not English, she was told that she didn’t have to come to team meetings because she didn’t speak or understand their language. Because of these experiences, Dr. Novellus endeavors to ensure that no one she works with feels excluded. Ultimately, such experiences inspired her to start EnrichHER with a narrow focus to assist underrepresented groups such as women, Black women, and people of color.

Do you have any advice for someone interested in becoming an entrepreneur?  

“Do a self-reflection on if you can grow in all the ways you need to grow in order to be the type of entrepreneur that you want to be.”

It is important to do a self-reflection to make sure entrepreneurship is right for you. Although entrepreneurship doesn’t have a safety net, Dr. Novellus believes a successful entrepreneur can come up with an impactful solution that people value, and that will generate revenue.

Each day Dr. Novellus is challenged with figuring out the best use of her time to have the biggest impact on her target audience. She starts her day with words of affirmation and journaling to make sure she is in the best mindset to envision, brainstorm, and execute the tasks of the day.

Specifically, for Dr. Novellus, it took her a long time to transition into the entrepreneurial mindset because she was used to the academic way of doing things. While pursuing her Ph.D. at George Washington University, Dr. Novellus worked a full-time job at John Hopkins University and later practiced as a management consultant until she completed school. In school, Dr. Novellus was used to repeating what the professor wanted to hear and not encouraged to think more creatively. Dr. Novellus feels some of her educational experience stifled her entrepreneurial thinking, but once she broke free of that way of thinking, she was able to adjust her mindset to become the successful entrepreneur that she is today.

More advice: As an entrepreneur, you must be able to pivot quickly based on customer feedback. You have to have the ability to learn from others and make modifications quickly to thrive.

What is your favorite part of running enrichher? 

“My favorite part is that it is all up to me to decide what to do to fulfill this goal that I have.”

Dr. Novellus enjoys waking up every day and getting to reflect on the decisions that she makes for EnrichHER. She appreciates the fact that she decided to live her freedom in a way that positively impacts others.

Dr. Novellus has a weekly newsletter The Secret, the Significant, the Successful: Profiles of Women-led Businesses, which showcases the profiles of women-led businesses and her commitment to empowering women.

It was a pleasure getting to interview Dr. Novellus, and I cannot wait to see the continued work Dr. Novellus and EnrichHER continue to do.

For more information on EnrichHER or to sign up to become a member, click here for further details.


Ashli Jones, at the time of this post, is a third-year law student at Penn State Dickinson Law. She is from Long Island, New York, and is a graduate of Spelman College in Atlanta, Georgia. Ashli is pursuing a certificate in Entrepreneurship with an Intellectual Property and Technology concentration. She is interested in intellectual property within the entertainment law field. Ashli is the President of the Sports & Entertainment Law Society, Mentorship Chair for the Women’s Law Caucus, and Social Chair for the Black Law Students Association.

Sources:

https://enrichher.com/

https://www.cnbc.com/2020/02/25/underfunded-female-demographic-is-launching-the-most-start-ups-in-us.html

http://www.thewealthyyogi.com/about

https://s1.q4cdn.com/692158879/files/doc_library/file/2019-state-of-women-owned-businesses-report.pdf

 

Photo Sources:

https://www.startupfunding.co/episodes/dr-roshawnna-novellus

https://helloalice.com/resources/funding/enrich-her-funding

 

 

From Play Time to Profit Time – How to Tell When Your Hobby Becomes a Small Business

By: Christian Wolgemuth

We all have hobbies – things we do for pleasure during what little free time we have in our lives.  Examples are playing music, raising animals, woodworking, and gardening.  Sometimes those hobbies even have the potential to make a little extra money for us, like getting paid to play at a concert or by selling a piece of handmade furniture.  As we invest more of our personal time and money into our hobbies, they may start to look more like small businesses.  This matters because if your hobby is an activity engaged in for profit, you can deduct the costs and expenses you incur from your taxable income.

The IRS provides nine factors to consider when distinguishing between a hobby and a legitimate small business with a for-profit motive.  As we go through each of those factors below, keep in mind that they are evaluated objectively and that no factor, in particular, is given any more weight than another.

whether you carry on the activity in a “businesslike manner”

Operating in a “businesslike manner” means you adhere to additional formalities and take extra steps that you would not necessarily do if you were just engaged in a hobby.  For example, keeping accurate written records, creating an entity like a limited liability company (LLC), and adopting more efficient techniques and methods can all show a for-profit motive.

whether the time and effort you put into the activity indicate that you intend to make it profitable

Simply put, the more time you devote to the activity, the more likely it is that you are trying to make a profit.  That does not necessarily mean you have to quit your current job entirely, but it does mean that a significant portion of your remaining time should be focused on running your new business.

whether you depend on income from the activity for your livelihood

This factor is pretty self-explanatory.  If you need this activity or business to put food on the table, then it looks like a for-profit endeavor.  On the other hand, if you have substantial income from other sources, then your side hustle may seem more like a recreational hobby.

whether your losses are due to circumstances beyond your control and/or are normal in the startup phase of your type of business 

Startup costs that lead to declared losses are typical in many legitimate for-profit businesses. Still, if losses persist beyond the initial startup phase of your business, it may appear like you are not actually trying to earn a profit.  The exception to this statement comes in the form of losses that are beyond your control, such as loss from fire, natural disaster, theft, or changes in market conditions.

whether you or your advisors have the knowledge needed to carry on the activity as a successful business 

Do you have a very particular set of skills?  Skills that you have acquired over a long career?

Having skills and expertise in your field and applying them to your business activity is generally indicative of a profit-making motive.  However, even if you do not have those skills yourself, you can seek the guidance and expertise of outside consultants and advisors while trying to make your business profitable.

whether you were successful in making a profit in similar activities in the past 

If you have performed the same type of work in a profitable manner in the past, then it is reasonable to say that you are doing it to make a profit now.  You are not required to do the exact same activity now as you had done previously; it just has to be similar.  Examples of similar activities would be photography and graphic design, or performing music and giving instrument lessons.

whether the activity makes a profit in some years and how much profit it makes 

Generally speaking, a legitimate business activity should generate profits more often than it generates losses.  The exception to this generality is when profits – although perhaps few and far between – are quite substantial.  For example, you may spend years developing a product and incurring expenses all along the way, but when you are finally able to bring that product to market, you achieve a windfall.

whether you can expect to make a future profit from the appreciation of the assets used in the activity 

Appreciation in assets includes increases in the value of land and real estate.  This means that you can legitimately incur expenses for maintenance and upkeep of property without simultaneously making a profit, so long as you reasonably expect to realize a profit from the disposition of the property in the future.

whether there are strong elements of personal pleasure or recreation

Finally, it should not appear that you are only engaged in the activity for your own personal enjoyment; the profit-making motive should be as strong.  This is not to say that we should not enjoy the work we do; I would go so far as to say that we should all be fortunate enough to love our jobs.  However, to be a legitimate business, it has to be about more than just personal enjoyment.

Turning your hobby into a legitimate small business can be a great way to earn extra cash and deduct your expenses while doing the things you already love to do.  Just remember that if you are going to take advantage of the favorable tax treatment, you must show that you are engaged in an activity for profit.

This post was originally authored on March 18, 2020, and can be found here.


Christian Wolgemuth is a recent graduate of Penn State Dickinson Law. He is currently a Law Clerk at McNees Wallace & Nurick LLC helping clients navigate the continuously changing world of cybersecurity and privacy law.

Sources:

Income & Expenses | Internal Revenue Service – https://www.irs.gov/faqs/small-business-self-employed-other-business/income-expenses/income-expenses

Electronic Code of Federal Regulations.  Title 26, Chapter I, Subchapter A, Part 1, §1.183-2   Activity not engaged in for profit defined.  https://www.ecfr.gov/cgi-bin/text-idx?SID=2c8c515e70d79f99314ab3dd0c63c6f4&mc=true&node=se26.4.1_1183_62&rgn=div8

Photo Sources:

‘A Very Particular Set of Skills’: Revisiting the Amazing Taken Speech – https://www.esquire.com/entertainment/movies/a31775/taken-speech/

https://www.happify.com/hd/how-to-find-time-to-pursue-a-hobby-you-are-passionate-about/

Consignment Considerations in a Retail and Resale Revolution

By: Christian Wolgemuth

Consumer habits and shopping preferences change constantly. Spontaneous trends, social issues, and traditional marketing all influence the types of products that consumers seek and happily spend their money on.  Driven by a desire for vintage goods, unique items, and great deals, consumers are flocking to consignment shops (both brick and mortar and online) to make those purchases.  The consignment industry and individual businesses are growing at a rapid rate in order to keep pace with those consumer demands, creating amazing opportunities for entrepreneurs.

For both consignors and consignees, there are customers to satisfy and profits to be earned, but entrepreneurs looking to jump into the consignment game need to be aware of certain risks and ways to mitigate those risks.

Consignment insurance is a way to mitigate some of those risks.

the business opportunity

There is no shortage of deals to be had at thrift stores like Goodwill or Salvation Army, and yard sales and auctions are not going anywhere anytime soon either.  And while consignment shops are not a new concept, their recent growth has been explosive.  Given the rapid growth, it can be hard to find exact revenue figures; reasonable estimates for total revenue in the United States for 2018 were between $17.5 billion and $24 billion.  Continuing the trend, revenue could surpass $50 billion by 2023.

Research shows that 12-15% of Americans will shop in a consignment or resale shop in a given year, while only 11% will shop in a factory outlet mall.  Realistically, that is not much less than the 19.6% who will shop in a traditional apparel store or the 21.3% who will shop in a major department store.  Consumer interest—and the opportunity for entrepreneurs—is not limited solely to used clothing and apparel.  For example, antiques account for 13% of annual consignment and resale revenue, and new items are commonly being sold on a consignment model as well.

Check out Building Character next time you are in Lancaster, PA

One of the biggest opportunities for entrepreneurs is in the consignment of new, small-batch goods, as well as pre-owned, specially-curated items.  Examples of new products could be hand-made items like artwork, jewelry, and other small housewares; specialty pre-owned items could include antiques of a particular theme or collectibles.  Regardless of what the products are, the consignment business model offers attractive benefits to the entrepreneurs on both sides of the relationship—the consignor and the consignee.

The benefit to the consignment model to the consignor (the party making and/or supplying the goods) is in being able to enter the retail (or resale) world without taking on all of the overhead costs and risks from the beginning.

The consignor can focus on developing a product, a brand, and testing marketability without having to worry about launching an actual store.

Once the consignor acquires or manufactures the goods, they are turned over to the consignee to be sold to the consumer.  Once the sale is made, the consignor gets the proceeds and the consignee takes a commission (the rate of which would be negotiated by the parties ahead of time).  Later on, once the product has proven to be marketable and profitable, the entrepreneurial consignor could choose to open a traditional retail store specific to her brand, should she wish to do so.

The advantages to the consignee are complementary to those of the consignor.  The consignee does not have to worry about the costs or hassle of product development or manufacturing.  Instead, the consignee can focus on running the brick and mortar operations and providing a unique retail experience to the consumer.  The consignee earns his commission when an item is sold and is not burdened with the financial responsibility of acquiring and maintaining inventory.

the risk

Security camera footage of one of the suspects who allegedly stole nearly $10,000 worth of jewelry.

It should not be surprising to hear that I love exploring the myriad consignment shops in Central Pennsylvania selling all sorts of interesting items and antiques.  I’m sure you can imagine my surprise when I heard that one of my favorite local establishments was robbed of nearly $10,000 of jewelry, and that got me thinking—when something like this happens, who is financially responsible and how can that risk be mitigated?

the solution

The risk of loss and damage to inventory from theft, fire, and natural disasters is very real to any consignment business—and this risk applies to both the consignee and the consignor.  Ultimately the consignee is financially responsible for the consigned goods once the consignee has taken possession from the consignor.  This means that if inventory in the consignee’s shop is stolen, burnt up in a fire, or washed away in a flood, the consignee is liable to the consignor for the value of the goods.  Consignment insurance provides a way to mitigate this significant risk of loss for both parties.

The consignee is the insured party responsible for maintaining the policy.  The value of the policy must be large enough to cover the value of the goods and inventory on consignment in the consignment shop from all consignors with whom the consignee is doing business.  Depending on the nature of the relationship between the parties, the consignee may be able to pass a portion of the cost of the premium on to the consignor through the consignment agreement.

The consignor would also be left empty-handed in the event that the consignee goes belly-up after the inventory is lost or destroyed.  To make sure this does not happen and to make sure the consignor receives compensation for her products, the consignor should require in the consignment agreement that the consignee maintain adequate insurance.  If the consignee refuses to do so, the consigner may want to consider doing business with another consignment shop.  After all, the number of consignment shops has increased by 7% per year for the last two years.


Christian Wolgemuth is a recent graduate of Penn State Dickinson Law. He is currently a Law Clerk at McNees Wallace & Nurick LLC helping clients navigate the continuously changing world of cybersecurity and privacy law.

 

 

Sources:

“Used Merchandise Stores Industry Profile” – First Research –  http://www.firstresearch.com/industry-research/Used-Merchandise-Stores.html

“thredUP 2019 Resale Report” – thredUP – https://www.thredup.com/resale

“Industry Statistics & Trends” – NARTS: The Association of Resale Professionals – https://www.narts.org/i4a/pages/index.cfm?pageid=3285

“Ranking the top 10 vintage and consignment shops in central Pa., according to Yelp” – Penn Live – https://www.pennlive.com/life/2019/06/these-are-the-top-10-used-vintage-consignment-stores-in-central-pa-ranked.html

“Police seek people involved in burglary at Burning Bridge Antiques” – Lancaster Online – https://lancasteronline.com/news/local/police-seek-people-involved-in-burglary-at-burning-bridge-antiques/article_750ac604-3af8-11ea-a5d3-bf5353dce322.html

 

Food, Brews, and You: A Guide to Opening a Restaurant and Procuring a Liquor License

By: Allyson Lonas

Are you interested in opening a restaurant and selling alcohol? Do you know how to obtain a liquor license? If not, no fear! A majority of new entrepreneurs have never opened an establishment before and don’t know how to begin that process.  The process is a lot less stressful than you may think! Yes, the paperwork involved is extensive. The licenses and permits can be costly, but be aware: do not cut corners because legal ramifications and fines could cost you in the long run. However, if you follow a checklist, apply early, and communicate with your local government, you can have your business ready for opening day!

beginning process

Before you can start selling food and brews, you must start at the beginning. A business license is required in the United States. The process of acquiring a business license will vary depending on the state you live in. A quick visit to the US Small Business Administration (“SBA”)’s website can help you find the specific rules for obtaining a license in your area. And if your restaurant sells alcohol, a federal and state business license will need to be obtained. Next, every business must obtain an employer identification number (“EIN”) to operate legally. The EIN number is an assigned tax ID number by the IRS. An EIN number can be easily obtained through the IRS website.  Another necessity is a foodservice license issued by the city or county health department. After obtaining a foodservice license, the health department will regularly inspect your restaurant in-person to ensure you are adhering to all the restaurant food safety regulations. Do not fail the inspection or you will risk losing your license! When applying for a license, you will need (1) the name of your restaurant, (2) address for a permanent kitchen facility, and (3) the owner’s personal information. An application from your local health department can be obtained online or in person.  You will also need to obtain a food handler’s permit. A food handler’s permit signifies that your restaurant will meet food sanitation, storage, protection, and preparation regulations. You will need to complete a state-approved food handler’s course and purchase the permit. Check out servsafe to find resources along with locations and times for your employees to take their test.

Remember, if you are intending to serve alcohol at your establishment, you will certainly need a liquor license too.

what is a liquor license? 

A liquor license is a permit from the government that allows someone to sell alcoholic beverages. An entrepreneur who is interested in selling alcohol should consult the alcohol laws in their state. Each state has its own Alcohol Beverage Control Board, the agency in charge of regulating the sale of alcohol. Many questions about alcohol and drinking laws can be answered by local law enforcement agencies. Others can be answered by the agency controlling alcohol within the state. In Pennsylvania, the owner of the license must follow the Pennsylvania Liquor Control Board’s regulations. Typically, the laws cover when liquor can be served, where liquor can be served, containers it can be served in, how much liquor can be served at a time, and to whom liquor can be served.

what type of liquor license should you acquire? 

An entrepreneur interested in selling alcohol in their establishment will need to acquire an on-license liquor license. However, there are additional classes of liquor licenses to be aware of that vary state to state.

  • Restaurant licenses: limit what percent of restaurant earnings can come from alcohol
  • Beer and wine license: a choice for entrepreneurs who do not intend to serve hard liquor and want to limit themselves to only beer and wine
  • Tavern License: an option for entrepreneurs who intend to make more profit off of liquor rather than food (typically more of a bar than a restaurant)
  • Brewpub Liquor License: is another option if you plan to brew your own beer or make your own wine

How can you obtain a liquor license?

There are many different ways to obtain a liquor license. Typically, you must be at least twenty-one years old to obtain a license. To obtain a license in Pennsylvania, an application must be submitted to the Bureau of Licensing. The form can be found on the Pennsylvania Liquor Control Board. The application process to apply for a liquor license can take an extended period of time. Apply early!

Generally, the distribution of liquor licenses in Pennsylvania is regulated by a quota system. In small towns, liquor license quotas may run low and you may not be able to get a license at all if the quota is filled.

Also, the public is allowed to attend meetings to discuss your application. Upon approval, the applications move to the state for approval. An applicant can also obtain a license through the transfer of an existing license from a person who operates a licensed establishment, but if ownership of a licensed establishment changes, the new owner must submit an application for the transfer.

what could jeopardize your license? 

The costs to restaurant owners, if they do not abide by the rules, could be astronomical. The privilege of holding a liquor license can be taken away if owners do not follow the responsibilities specified by the Liquor Control Board, the State police, and state liquor law. Listed below are the most common violations that can cost entrepreneurs their livelihood and shut down their business.

1) Serving Minors

Selling beer, wine, or hard liquor to a person below the age of twenty-one will result in a Liquor Control Enforcement Violation. Be wary of not checking IDs. In Pennsylvania, the PLCE uses compliance checks and sends in a minor at the busiest times to purchase alcohol. If a minor manages to purchase alcohol, a violation is written up. It is important for the bartender to ask and examine the date of birth of the driver’s license rather than just asking for identification. To avoid stress, consider purchasing an electronic ID scanner to instantly authenticate a patron’s ID and confirm they are of age to purchase alcohol.

2) Not being RAMP certified

Responsible Alcohol Management Program (RAMP) is offered through the PLCB Education Bureau. The goal of RAMP is to ensure compliance with the liquor laws. The responsibilities of an owner are a matter of regulation and the PLCE will follow up to check on RAMP compliance.

3) Serving Patrons Who are Visibly Intoxicated

If someone is visibly intoxicated before they enter your establishment, do not let them in! It is against the law to serve patrons who are visibly intoxicated

4) Over Serving

If your bartender serves someone who is visibly intoxicated, you could also lose your license! The bar, bartender, and license holder will be held liable and could be forced to pay damages if injury results. Make sure your bartenders are trained to detect a visibly intoxicated individual. To avoid problems with patrons, send your waitstaff to a “TIPS” training course, which will teach them how to serve alcohol responsibly. TIPS stands for Training for Intervention Procedures. If you don’t want to send them, contact a local TIPS trainer and a trainer will come to your location, give a training session, and administer a certification test at the end.

always be aware! 

Be aware of other regulations and stay informed on ways you can lose your license. Since restaurant startup costs can be high it is better to be safe than sorry. It is important to make sure you are protected so you can continue to serve your food and beverages. The best way to avoid legal consequences is to communicate with your local government and be proactive. Below are a few other quick ways to protect yourself from future legal ramifications.

  • Business Owners Policy: is a policy for restaurant and bar owners who need general liability insurance, property insurance, and business interruption insurance. This policy packages the three together and is a cheaper choice than buying each separately.
  • Liquor Liability Insurance: Due to general liability insurance purposely excluding claims arising as a result of the use of liquor, liquor liability insurance is needed and sometimes even required. Liquor Liability Insurance is a smart choice for an owner who wants to diminish damages.
  • Form a Limited Liability Company (LLC): An LLC provides protection to LLC owners by limiting the owner’s personal liability. There are many other advantages but protecting personal assets is the most important. Setting up an LLC is a simple process. Here, you can find a step by step process to set up your LLC.

Now, you should have a better idea of how to get started in the food and liquor industry. It is important to get licenses but be aware of other permits your local municipality requires too! Check back next week for a follow-up article that discusses


Allyson Lonas, at the time of this post, is a rising second-year at Penn State Dickinson Law. Originally from Johnstown, Pennsylvania, Ally attended The Pennsylvania State University for her undergraduate degree and has interests in corporate law, antitrust law, and government law. In her free time, pre-COVID-19, she enjoyed traveling.

 

 

Sources:

https://www.gettips.com/index.html

https://www.thebalancesmb.com/tips-training-for-restaurant-employees-2888532

https://www.thebalancesmb.com/all-about-restaurant-liquor-licenses-2888539

https://pataverns.com/keeping-the-bar-open/

https://upserve.com/restaurant-insider/liquor-license/

https://www.consumer.ftc.gov/articles/0388-alcohol-laws-state

https://www.servsafe.com/ServSafe-Food-Handler

https://www.fsrmagazine.com/expert-takes/these-are-permits-and-licenses-youll-need-open-restaurant

https://www.lcb.pa.gov/Pages/default.aspx

https://www.thebalancesmb.com/all-about-restaurant-liquor-licenses-2888539

https://www.consumer.ftc.gov/articles/0388-alcohol-laws-state

https://www.fda.gov/food/fda-food-code/state-retail-and-food-service-codes-and-regulations-state

https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online

https://www.sba.gov/business-guide/launch-your-business/apply-licenses-permits

https://www.rampcertified.com/What.aspx

https://upserve.com/restaurant-insider/11-ways-lose-liquor-license/

https://usinsuranceagents.com/insurance-restaurants-and-bars/#:~:text=A%20unique%20policy%20for%20restaurants%20and%20bars%20is,in%20order%20to%20even%20receive%20a%20liquor%20license.

https://www.moneyunder30.com/should-you-form-an-llc

http://pennsylvanialiquorlicense.com/types-of-licenses

 

Photo Sources:

https://www.lessings.com/webphotos/20161031_121335_000.jpg

https://www.bing.com/images/searchview=detailV2&ccid=IHkVF7%2b6&id=426373AA2909FF403BBC7A818DD1FAE9A389824C&thid=OIP.IHkVF7-6FW5EnqVQkResAQHaFj&mediaurl=https%3a%2f%2fqtxasset.com%2ffiles%2fnightclub%2fnodes%2f2015%2f10196%2fLiquor-License.jpg%3fNYrseWMUlADKaq7loD9g3NiIpWn060IO&exph=503&expw=670&q=liquor+license&simid=608000312095801784&ck=06D1AC144CB9C16281A95E806680BD89&selectedIndex=39&FORM=IRPRST&ajaxhist=0

https://www.pexels.com/photo/alcohol-alcoholic-bar-beverage-4784/

 

 

 

 

 

Julian Brodsky | Entrepreneur of the Month | August 2020

By: Rachel Tunney

Pennsylvania. It’s known for deep history and a creature’s shadow. It’s the home of the Liberty Bell and Hershey Park, the Philly cheesesteak, and trees of the Appalachian. But did you know that Pennsylvania also has deep roots in an industry that changed forever our connectivity with one another?

The cable system.

And that’s because part of the cable system’s history involves Pennsylvania’s own Julian Brodsky:  Co-founder, Previous Chief Financial Officer, Director and Vice Chairman of Comcast Corporation, a company incorporated right here in Pennsylvania. What started off in a 700 sq. foot space soon became the journey of a lifetime for Julian Brodsky.

Raised in Philadelphia and a graduate of the Wharton School of the University of Pennsylvania, Julian served in the United States Army before becoming an accountant. When he started accounting, he met among his many clients Ralph J. Roberts. In 1963, Roberts would persuade both Julian and Daniel Aaron to join him in purchasing a 1,200-subscriber cable TV operator. That creation was known first as American Cable Systems but was incorporated in 1969 as Comcast Corporation. (Fun fact: “Comcast” is a combination of “communications and broadcasting.”) Julian’s role as Chief Financial Officer of Comcast led to financial expertise in capital markets, accounting, and tax matters. At various times, he oversaw merger and acquisition efforts, international development and expansion, in addition to accounting activities, administration, and shareholder relations. He also founded and served as CEO of Comcast Ventures, which conducted Comcast venture capital activities.

Julian was elected to the Pennsylvania Cable and National Cable Halls of Fame and received the National Cable Television Association’s Distinguished Vanguard Award. He currently serves as a trustee of the Philadelphia Museum of Art as well as of the Philadelphia Chamber of Music Society. Julian is a director of the RBB Fund, Inc., and he has served on the boards of numerous public companies as well as many not-for-profit organizations over the years. 

A quick note: I’m certainly not the first to have had the incredible opportunity to speak with Julian. Here’s a link to The Hauser Oral and Video History Collection from The Cable Center for those interested in a deep-dive of Comcast Corporation and Julian Brodsky’s part in it. Last year, Kevin Chemidlin did a podcast on Julian which can be found here.  I focused my interview on extracting his best wisdom for young, budding entrepreneurs and the lawyers that want to serve them.

how do you spell success? r-e-s-p-e-c-t 

One aspect of Comcast’s history that fascinated me was its embracement of team throughout every transaction, milestone, and challenge. As someone who had over eleven different roommates in a given year while living in NYC, the knowledge that three individuals could work so well together for so long was… shocking. I asked him, how did you do it? What was it that solidified teamwork as a core concept of Comcast’s history and reputation?

“Respect. Respect for the abilities. Respect for the integrity. That we actually liked each other made that all the easier.”

Comcast’s founders – Ralph Roberts (left), Julian Brodsky (right), and Daniel Aaron – at a Comcast facility in Northeast Philadelphia in the late 1980s or early 1990s. Image from Philadelphia Inquirer.

Respect. Now I could understand how that could work. But certainly, I thought, respect was easy with three talented men always on the same page. However, in the same breath, Julian laughs. He recalls how he and Dan Aaron never saw eye-to-eye, constantly fighting over everything in the business.

A famous allegory, (I say famous because the image is on the internet) describes the management of Comcast as three men driving a car. Julian has his foot on the pedal. Dan Aaron, working in operations, and terrified of Julian beside him, has his foot on the brakes. And Ralph, “calm as can be” has his hands on the wheel, staying the course. Julian points out how unique the setup was: the allegory is a traditional role-reversal. As the financial guy, Julian says normally he would be seen as “Dr. No” while Dan would be working on creative solutions. But this CFO was not risk-averse in the slightest.

“We were so different that way. But of all the business experiences, being partners with them and all we did was one of the joys of my life.”

Inevitable disagreement between Dan and Julian was part of what worked for the company. And because the two respected each other, in the end, this crucible managed by Ralph yielded great results and was never enough to weaken the team.

lawyers, what does your client want? for you to understand them

Interested in working as a lawyer for entrepreneurs? I asked Julian what sort of attributes in a lawyer are best for business. He was quick to mention the following:

  1. Be Bright
  2. Be Knowledgeable
  3. Be Experienced

And the best trait for a lawyer to have is the ability and desire to understand their client. You need to know, Julian states, what that client is capable of doing and NOT capable of doing.

He said that in its industry, the Comcast team was known as “control freaks.” Julian stated that deals wouldn’t be made unless they had control of them, and the team lost a lot of deals because of this. Therefore, he stated, Comcast needed lawyers who were clever enough to give them the control they so desired while also, somehow, getting the deal done.

 “You have to understand what your client is willing to do. And it may or may not make sense.”

He says it is important to understand the sophistication of your client’s world. For instance, what is the culture behind the negotiations and deals that are being made? He described how an inexperienced entrepreneur may assume that a “junkyard dog” style lawyer could land her the best deals. But if that entrepreneur had been attempting to work with Comcast, the deals would have been lost. Because that wasn’t the way the company operated.

proudest moments: the entrepreneurial spirit of Comcast and passing the torch 

It is clear that in his career, Julian is proud of two things: (1) Comcast’s creation and (2) Comcast’s future. Before becoming the corporation we know today, Comcast started out in a 700 sq. foot room with used furniture: $5 for a chair and $10 for a desk. To save even more money, Julian forewent the purchased furniture, bringing in his own card table from home.

“We built this enormous company – based on true entrepreneurial spirit – taking all kinds of risk along the way. But thinking it through and putting in hard work and ability and getting it done.”

Comcast also achieved one of the hardest things a company can: moving from the generation of the founders/entrepreneurs to the next generation of professional management. And not only did Comcast achieve it, it excelled at it. You can hear the smile in Julian’s voice as he told me about Brian Roberts, the son of Ralph Roberts, and his team, “one of the great stories of American business.” Brian, the current Chairman of the Board, President, and Chief Executive Officer of Comcast, worked in all areas of the business at a time when he could use the three co-founders as mentors as well as a safety net. Julian believes Brian is one of the most incredible CEOs of the country if not the world.

 “We all learned to bite our tongue, encourage, and Brian just pulled up one miracle after another.”

Brodsky: business, philanthropy, and family

Julian has quite a reputation as a philanthropist as well. He enjoys having the opportunity to give back, and that trait is found in his entire family. His wife and three daughters love supporting their own individual interests. It keeps the family together, he said and allows them to invest in areas that mean the most. Julian and his wife overlap in their appreciation for music and the arts. In fact, his second date with her involved the opera.

When I asked Julian, what allowed him to achieve success while also having a family, he was quick to credit his wife. You can hear the admiration he has for her, as he describes her unwavering support for him while he worked very long hours and sometimes seven days a week. He acknowledged that it was a burden on her “which she handled magnificently.”

entrepreneurs: say it with me- Mentorship, mentorship, mentorship

Penn State Dickinson Law’s Inside Entrepreneurship Law Blog sees such variety in its selected Entrepreneurs of the Month. However, there are certain themes that repeat themselves in almost every interview. And one of those is the importance of mentorship. That theme is no different here. Julian indeed credits the development of his core values to close mentorships. At one point, he began to work on public companies that were subject to regulation by the Securities and Exchange Commission (“S.E.C.”). He was growing concerned that with this new complexity that he may do something wrong. But someone passed along wisdom during that time that stayed with him for life:

“I suggest you do whatever you think is right. If you can judge between right and wrong, as I know you can, rest assured the law will take care of you.”

Good advice, indeed. (Side note: This came from Abraham Freedman– the United States Third Circuit Judge from 1964 to 1971.)

This notion of doing what he believed was “right,” Julian said, put him in a difficult position, particularly with his partners. That “right” way of thinking found its way into analyzing Comcast’s securities disclosures, finances, and loans.  His team, quite seriously, asked him one day if his “Boy Scout ways” were putting Comcast at a disadvantage. Julian answered honestly: Yes. No question about it, but only in the short run. Comcast would lose deals and opportunities to other companies. And Comcast may be viewed negatively due to conservative accounting. But, he said, for the long haul, Comcast would instead have such integrity, such credibility, and such a reputation, that things would be okay.

And, I think we can all agree, he was most certainly right.

just a side note… be careful and mind your voir dire! 

One comical tale made me laugh perhaps even more than the average individual because it involved a topic discussed in my Advocacy I class. Julian recounted his first time in a courtroom- serving jury duty. Yes, that was his first time in a courtroom. See, Julian mentioned that even after becoming a public corporation, there was a surprising lack of litigation involving Comcast. From a business standpoint, no one wants the fate of their business affairs to be in the hands of a jury or a judge. For that reason, negotiating solutions to business problems was imperative to avoid litigation.

 “That was part of our style. That’s who we were. We avoided it. We tried to do things right.”

The morning of jury selection, Julian was excited, looking forward to serving jury duty on a complex commercial litigation case. And during selection, the judge had asked those there if anything would hinder their ability to serve. Julian spoke up (honestly, as always):

“I don’t know if it’s relevant or not, but I really have this thing for the plaintiff’s bar.” (It’s true. He really, really does not like the plaintiff’s bar.)

He was asked if his views would prevent him from being fair in his verdict, to which of course he said they would not. As fate would have it, he not only stayed on the medical malpractice case, he became the jury’s foreman! Julian said it was a pretty ridiculous case (it involved someone accused of failing to clip a toenail properly) and after an overwhelming defense, the jury was told that if they didn’t have a verdict within fifteen minutes, they would have to come back the following week. Back in the jury room, Julian said to his fellow jurors, “Does anyone think this guy should get a nickel?” Silenced ensued, to which he responded, “Hearing nothing, we’re out of here!” Six minutes later, they were back in.

“And that was the end of that.”


Rachel Tunney, at the time of this post, is a rising 3L at Penn State Dickinson Law. Formerly a professional New York City dancer/singer, Rachel now is interested in corporate litigation and has accepted a clerkship in the Delaware Superior Court for after graduation. Rachel currently serves as the Dickinson Law Student Representative for the Pennsylvania Bar Association and is a Comments Editor of the Dickinson Law Review. She is also Professor Prince’s Research Assistant, a position she enjoys immensely.

Photo Sources:

https://www.inquirer.com/philly/business/20110501_On_eve_of_his_departing__Comcast_s_Brodsky_looks_back_at_the_many_wins.html

 

 

 

 

 

 

 

 

 

Reopening During COVID-19: General Guidelines for Entrepreneurs in Pennsylvania

By: Mitchell Snyder

As the COVID-19 pandemic continues, many businesses are looking to the future and making plans to reopen and welcome employees back to work. The process of reopening will present both logistical and legal questions as businesses put in place procedures to ensure the safety of their employees. To help in this endeavor, we have compiled a list of precautions to consider including in your business reopening plan.

employee questionnaires 

Employers should consider requiring employees to complete a questionnaire upon returning to work. This questionnaire will seek to determine whether the employee has recently tested positive for COVID-19, recently experienced any COVID-19 symptoms, or believes they have been exposed to someone who has tested positive, and/or has any other reason to believe that they may have been exposed to the virus. This information allows the employer to make an informed decision on whether to allow the individual to return to work while reassuring their employees that their workplace is safe.

The Centers for Diseases Control and Prevention (CDC) recommends focusing questions on the following symptoms:

  • Fever or feeling feverish (chills, sweating)
  • New cough
  • Difficulty breathing
  • Sore throat
  • Muscle aches or body aches
  • Vomiting or diarrhea
  • New loss of taste or smell

Some employers may be concerned about whether they can legally require employees to disclose this kind of medical information. The Americans with Disabilities Act (ADA) allows such questionnaires when the employer reasonably believes that an employee will pose a “direct threat” due to their medical condition. In the case of COVID-19, the Equal Employment Opportunity Commission (EEOC) has determined that currently, COVID-19 qualifies as a “direct threat.”

It is important to note that the ADA requires all medical information collected be maintained confidentially and stored in a separate medical file from the employee’s personnel file. Therefore, prior to implementing a questionnaire, employers should make plans for document collection and storage with their human resources department.

Lastly, questionnaires will only be permissible so long as COVID-19 qualified as a “direct threat.” Therefore, employers should continue to monitor the latest updates from the CDC, local health departments, and the EEOC to determine whether they can continue to require questionnaires.

temperature screening of employees 

Fever is a commonly reported symptom of COVID-19. Therefore, employers may want to conduct touchless temperature checks before allowing employees to enter the workplace. Similar to questionnaires, the ADA allows medical examinations of employees, such as temperature checks, when the medical condition in question qualifies as a “direct threat.”

To avoid the accusation of disparate treatment, employers should subject all employees to the same screening procedures. The Age Discrimination in Employment Act (ADEA) will not permit an employer to treat their employees differently based on age. (For more information on how to ensure compliance with ADEA during COVID-19, please click here.) Additionally, it is highly recommended that the screening be conducted by either a medical professional or a member of human resources in order to ensure confidentiality.

And note: If an employer keeps records of the information collected, those records might qualify as medical records. If this is the case, the employer would be required to retain these records for the duration of each worker’s employment plus 30 years and follow confidentiality requirements.

Lastly, like with questionnaires, employers should monitor the CDC, local health departments, and EEOC to determine whether they may continue to conduct touchless temperature checks.

requiring personal protective equipment (ppe)

Employers should consider providing employees with PPE, such as masks and gloves, for use while in the workplace.  The use of PPE has been proven to dramatically decrease the risk of infection from person to person. CDC Director Dr. Robert R. Redfield has explained, “Cloth face coverings are one of the most powerful weapons we have to slow and stop the spread of the virus.” Currently, in Pennsylvania individuals are required to wear mask when in public when they are unable to maintain a social distance of 6 feet.

It’s important to note that masks are not the only one form of PPE. Employers should consider providing the following PPE for employee use:

  • Masks
  • Face shields
  • Hand sanitizer
  • Gloves
  • Cleaning supplies and disinfectants

The high demand for PPE can make it difficult to find. Luckily, the Pennsylvania Department of Community and Economic Development compiled a list of PPE manufacturers and suppliers located in Pennsylvania to assist with your search.

social distancing in the workplace

Employers should consider ways to increase social distancing in the workplace. The Center for Disease Control (CDC) has published recommended social distancing strategies for businesses. They include:

  • Implementing flexible work hours
  • Increasing physical space between employee’s workstations
  • Increasing physical space between employees and customers
  • Implementing flexible meeting and travel options
  • Replacing in-person meetings with virtual ones
  • Allowing employees to telework if they are able
  • Delivering services remotely via phone, video, or the internet
  • Delivering products through curbside pick-up or delivery

What this looks like will depend greatly on the nature of the employer’s business, its size, and where they are located in the country. Social distancing measures could also include constructing physical barriers between employees, eliminating shared workspace, moving employee’s workspaces to allow for better distancing, and adopting policies limiting usage of shared spaces or utilities such as kitchens or elevators.

The Occupational Safety and Health Administration (OSHA) has provided recommendations for implementing social distancing requirements in the workplace. They include:

  • Marking six-foot distances with floor tape in areas where lines form
  • Posting signage reminding workers, customers, and visitors to maintain at least six feet between one another
  • Posting directional signs in hallways/corridors where the width restricts movement and limits social distancing
  • Move or reposition workstations to create more distance and install plexiglass partitions

Lastly, local governments have adopted differing requirements for social distancing in the workplace. As more becomes known about the transmission of COVID-19, guidelines may change. Therefore, employers should closely monitor state and local orders to ensure compliance.

Business safety signs 

In Pennsylvania you are required to post “COVID-19 Safety Procedures for Businesses” signs near all public entrances and in all employee common areas. These signs should be placed in locations where they are easy to spot. The Pennsylvania Governor’s Office provides printable PDFs of these signs at the following links:

additional recommended precautions

Employers can take additional steps to ensure their workplace is as safe as possible. These can include, but are not limited to:

  • Creating a documented reopening plan available to your employees outlining new procedures
  • Providing hand sanitizer with at least 60% alcohol for employee use in the office
  • Routinely disinfecting frequently touched surfaces
  • Limiting the use of shared office utilities and workspaces
  • Placing signs around the office encouraging social distancing
  • Requiring employees who are sick to stay home
  • Providing educational material about best hygiene practices outlined by the CDC

Some states have released templates for reopening plans outlining what is required in that specific jurisdiction. While Pennsylvania has not yet provided a template, you can consult the New York State reopening plan template when drafting your plan.  (Employers should check to see if a template is now available in Pennsylvania after the publication of this post.)

CDC “RESUMING BUSINESS TOOLKIT”

The CDC has created a toolkit for employers as they begin reopening their businesses. It includes a highly detailed “Restart Readiness Checklist” designed to help make returning to work as safe as possible. You should consult this checklist to ensure your reopening plan is following existing CDC requirements.

consult a lawyer 

Lastly, if you have any questions you should consult a lawyer on your business reopening plan to ensure it is compliant with all federal, state, and local requirements.


Mitch Snyder, at the time of this post, is a rising second-year law student at Penn State Dickinson Law. He graduated from Dickinson College where he studied Economics and Law & Policy. Currently, Mitch is pursuing certificates in both Civil and Criminal Litigation. He is an Associate Editor of the Dickinson Law Review, President of the Criminal Law Society, and a co-coach of the Dickinson College Mock Trial Team. He can be contacted at mps6411@psu.edu.

 

Sources:

CDC Resuming Business Toolkit

CDC Business Reopening FAQ

Pennsylvania Guidance for Businesses

OSHA Reopening Guidelines

NY Reopening Plan Template

https://www.forbes.com/sites/billconerly/2020/05/01/business-guide-to-reopening-thrive-in-the-economic-recovery/#1dc39ed324cd

https://www.forbes.com/sites/forbescommunicationscouncil/2020/07/22/five-keys-to-reopening-small-businesses-after-the-pandemic/#cc3a218295ae

https://www.natlawreview.com/article/temperature-screening-new-guidance-cdc-faqs-and-best-practices

https://www.eeoc.gov/laws/guidance/pandemic-preparedness-workplace-and-americans-disabilities-act

https://www.eeoc.gov/laws/guidance/enforcement-guidance-disability-related-inquiries-and-medical-examinations-employees

https://www.cdc.gov/coronavirus/2019-ncov/community/general-business-faq.html

https://www.cdc.gov/coronavirus/2019-ncov/community/organizations/businesses-employers.html

https://www.cdc.gov/coronavirus/2019-ncov/community/guidance-business-response.html

https://www.cdc.gov/niosh/topics/emres/ppe.html

https://s3.amazonaws.com/assets.production.proskauer/uploads/4d739edfa3c20447d9dbf8fbe39ba8f0.pdf

Image Sources:

https://test.abmp.com/sites/abmp.com/files/btwyford/images/open%20sign.jpg

https://cdn.nextgov.com/media/img/upload/2020/05/12/NGtemp20200512/route-fifty-lead-image.jpg

https://www.houstonmethodist.org/-/media/Images/Contenthub/Article-Images/Coronavirus/Hub_CoronavirusSocialDistancing_Social.jpg

 

 

 

 

 

 

 

The Unique Challenges Women Entrepreneurs are Facing in the Pandemic

By: Allyson Lonas

Women entrepreneurs are facing unprecedented challenges during COVID-19. In this pandemic, women may not only be faced with the challenge of running a business from home but could be simultaneously in charge of their children’s care and maintaining the household. These women have been given the task of adapting to a new business environment, developing out-of-the-box thinking, and using their skills to conform to this new era of entrepreneurship. They have had to in order to keep their business afloat. So, we must prioritize these women and focus on providing capital to female business owners.

Why are women entrepreneurs suffering more than their male counterparts? 

The COVID-19 global crisis has revealed that our daily lives are built on the unpaid work of women. Although women have outpaced men in college attendance and degrees, the number of women engaged in unpaid work continues to outpace that of men. Crises tend to reinforce the idea men are responsible for putting bread on the table while women should take care of the children. In the United States, statistics from 2019 reveal that the average hours per day parents spent caring for their children within the home was higher for women, even when these women worked outside of the home. In fact, a woman employed full-time spends an average of 2 hours on household activities and caring for family members.

According to the Bureau of Labor Statistics, the percentage of women engaging in household activities is 84.9% compared to 71.4% of men. Women spend three times as many hours as men in unpaid care and domestic work, limiting their access to opportunities in the workforce. This leads to women entrepreneurs being at the heart of the COVID-19 response.

As the formal and informal supply of childcare declines, the demand for unpaid childcare provision falls on these women. According to UNESCO, 1.37 billion students (80 percent of the world’s student population) are back home as COVID-19 closures expand. Overwhelmingly, this constrains a parent’s ability to work-from-home with children back in the household. According to the National Bureau of Economic Research, working women bear the brunt of the COVID-19 recession, unlike previous downturns that hit working men the hardest. In the aftermath of the global financial crisis, men suffered the majority of job losses because males dominated the manufacturing and construction industries which suffered the biggest blow. But, Sociology Professor Aliya Hamid Rao, at Singapore Management University, found women took longer to return to work even after the last downturn as a result of women taking care of their families.

COVID-19 provides different challenges; now, the hardest hit industries are those where workers cannot telecommute. And evidence suggests that working women are more likely to have jobs that do not allow them to telecommute. The majority of women-owned businesses are hair salons, nail salons, and hospitality/food service industries. Additionally, with women taking on the role of household maintenance, those hours spent at home taking care of their children are hours that could be spent on income generation. This burden is at the heart of the motherhood penalty in the workforce. It is devastating for women who have spent their whole life building their businesses, both economically and from a mindfulness standpoint. Their business is their livelihood, their success, and years of hard work.

What can women entrepreneurs do…

Even though many women entrepreneurs are overwhelmed with business operations and are worried about keeping their doors open, there is a solution to their problem. The solution involves support: on the governmental and community level.

  • On March 27th, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was enacted. The relief package was a $2 trillion economic relief package to protect people from the public health and economic impacts of COVID-19.
  • The Women’s Business Enterprise National Council provides a variety of options for women: funding options, grants, and financial resources, and business support tools. The coronavirus relief options include the Paycheck Protection Program, EIDL Loan Advance (providing $10,000 of economic relief to businesses experiencing temporary difficulties), SBA Express Bridge Loans, and SBA Debt Relief.
  • For small business owners, the Paycheck Protection Program resumed accepting applications on July 6 and is a crucial loan program providing loan forgiveness for retaining employees during the pandemic. On the Women’s Business Enterprise National Council website (link above), there is a “learn more” button to take you to a particular funding option where you can access additional program information, frequently asked questions, and view a direct application.
  • In Pennsylvania, we are fortunate that the Pennsylvania Department of Community and Economic Development has specific programs and funding to ensure that financial assistance reaches minority-owned and woman-owned businesses. So note: if you are a woman entrepreneur in another state, check and you may have similar assistance waiting for you!

With so many options available, the process might seem overwhelming and difficult. To help, here is a quick guide to help point women entrepreneurs in the right direction.

Even the playing field for obtaining financial help for female entrepreneurs is far from level. A recent study found that men were significantly more likely to secure funding than women when presenting the same business concept. Fortunately, there are non-traditional ways to obtain funding. The Capital Access Lab is a national initiative that aids to find, promote, and provide new kinds of capital to underserved entrepreneurs, including women. It will provide capital in the range of $250,000 to $1 million into three to five investment funds.

In addition, there are other programs to provide support for women. The company, EnrichHer, helps fund small businesses created by women. Their mission is to focus on social change for women and create opportunities for women-led businesses.

Verizon is even launching a mentoring program for women entrepreneurs affected by COVID-19. This program will connect women entrepreneurs and business owners with a network of women business leaders to guide them through the pandemic’s challenges. The goal is to help women entrepreneurs in a variety of ways.

The Women’s Bureau also helps women by developing policies to protect the interests of working women, promoting equality and economic security, and promoting quality work environments.

…and how can we help? 

Women entrepreneurs need us.

First, policymakers should consult women in economic planning and policies. Policies that do not consult women are less effective and create more harm. Before the pandemic, women struggled for equality, something that now seems to be further out of reach. The government and investors should refocus their attention once more on gender equality. Across the United States, 55% of the 20.5 million jobs lost in May were held by women. As the government shifts to rethinking its economy, it could aid the goals of equality. For example, improving the balance of women in companies’ leaderships.  Government subsidies could be used to replace pay for workers who need to provide childcare during the crisis due to school and daycare closures and are therefore unable to work, conditional on a continued employment relationship (where they can return to work immediately). Then they could partner with investors to channel funds into companies led by women. It is important we prioritize women entrepreneurs and help provide capital to them.

Second, we need to spread the word and promote women-owned businesses. If you know a local vendor, maybe try her restaurant for lunch instead of a mainstream establishment. If you are going for a morning coffee, visit your local barista. A simple share on Facebook can increase the business’s advertisement reach.

Lastly, we need to show support. Evidence suggests the impacts of the COVID-19 global recession will result in a prolonged dip in women’s incomes and labor force participation. Although these women have conquered the challenge of developing online strategies, revisited their business plans, and adapted to the customers’ needs in a time of crisis, they still need us. Women entrepreneurs are at the heart of this crisis and they need to know we are here to help!


Allyson Lonas, at the time of this post, is a rising second-year at Penn State Dickinson Law. Originally from Johnstown, Pennsylvania, Ally attended The Pennsylvania State University for her undergraduate degree and has interests in corporate law, antitrust law, and government law. In her free time, pre-COVID-19, she enjoyed traveling.

 

Sources:

https://www.sbc.senate.gov/public/_cache/files/9/7/97ac840c-28b7-4e49-b872-d30a995d8dae/F2CF1DD78E6D6C8C8C3BF58C6D1DDB2B.small-business-owner-s-guide-to-the-cares-act-final-.pdf

https://www.nytimes.com/2020/05/20/us/women-economy-jobs-coronavirus-gender.html.

https://home.treasury.gov/policy-issues/cares

https://www.wbenc.org/covid19/#financial

https://www.enrichher.com/about

https://www.usatoday.com/story/money/2020/06/16/verizon-launch-mentoring-program-women-small-businesses/3194324001/

https://www.un.org/sites/un2.un.org/files/policy_brief_on_covid_impact_on_women_9_apr_2020_updated.pdf

https://www.bls.gov/charts/american-time-use/activity-by-parent.htm

https://www.bls.gov/charts/american-time-use/activity-by-emp.htm

https://www.bls.gov/charts/american-time-use/activity-by-hldp.htm

https://www.bls.gov/news.release/pdf/atus.pdf

https://www.forbes.com/sites/maggiegermano/2019/03/27/women-are-working-more-than-ever-but-they-still-take-on-most-household-responsibilities/#33f131bb52e9

https://economictimes.indiatimes.com/magazines/panache/looking-at-the-pandemic-through-gender-lens-women-are-facing-the-brunt-of-covid-19-with-more-job-cuts-less-pay/articleshow/75735303.cms

https://www.cnbc.com/2020/05/07/how-covid-19-is-impacting-women-owned-small-businesses.html

https://www.dol.gov/agencies/wb/about

https://www.kauffman.org/capital-access-lab/

https://www.kauffman.org/wp-content/uploads/2019/12/capital_access_lab_exec_summary_FINAL.pdf

https://www.kauffman.org/our-grants/

Photo Sources:

Image 1: https://www.cnbc.com/2020/05/07/how-covid-19-is-impacting-women-owned-small-businesses.html (this link is above too)

Image 2: https://www.forbes.com/sites/janicegassam/2020/04/17/7-companies-offering-covid-19-relief-funds-for-diverse-business-owners/#5455887e591b

Image 3: https://www.wabe.org/women-are-losing-more-jobs-in-coronavirus-shutdowns/