Basic legal skills every manager needs


A large percentage of legal issues that businesses face arise from a lack of awareness. FILE PHOTO | SHUTTERSTOCK

I recently attended an audit training where the trainer insisted that all managers must have some sort of basic accounting and audit skills.

He challenged the attendees (most of whom had no finance background), that a good manager should at least know how to read a budget and interpret financial statements.

This had me thinking about the basic legal skills that every business person ought to have. In my assessment, a large percentage of legal issues that businesses face arise from a lack of awareness.

This exposes the business to serious risks arising out of costly mistakes. Here are some examples in everyday life.

An executive hurriedly signs contracts that bind the business to terms and conditions it cannot fulfil. The result is a breach of contract.

A human resource manager firing an employee on the spot over very flimsy reasons. This exposes the business to labour lawsuits.

A supervisor abusing and insulting his team members. One woman told me of how their boss would call them into a meeting and spend hours abusing them.

He would yell things like “If I had a gun I would shoot all of you,” and such abusive tirades. This kind of treatment also exposes the business to lawsuits.

A supplier delivering defective goods to a customer who has already paid in full and arguing that “goods once sold cannot be refunded.” This flouts the Sale of Goods and Consumer laws.

The list of everyday legal “misdemeanours” by untrained senior management is endless. I would not blame them for a lack of awareness but instead, I would counsel them to acquire basic legal skills tailored for managers.

These skills do not require one to have studied law and can be easily acquired. These simple skills do not contain the unpopular “legalese” but are offered in simple and concise language.

If I were to train a group of non-lawyers on simple legal skills that are recommended for senior management here is what I would offer:

Contract law

Contracts establish relationships in the business world. They dictate the terms of the business relationship, the roles and responsibilities and other relevant items.

If valid they have the force of law such that if one party breaches the contract, that can land him in trouble. I would advise managers to acquire basic contract skills.

They ought to at least know what to look out for when getting into contracts. This way they will minimise legal risk.

Employment law

A manager’s role is to make sure that the business does not flout any employment laws.

They need to know what to look out for when drafting simple employment contracts and also be well-versed with the mandatory requirements. Armed with such knowledge, I believe that labour disputes would be avoided.

Sale of goods

I would offer this training to businesses that supply goods and to some extent services. Managers ought to ensure that their sales processes adhere to the law.

The first thing I would recommend is the riddance of “Goods once sold cannot be returned” signs! I would recommend a policy that is aligned with the law.

Consumer laws

Managers ought to be well-versed in consumer law and ensure that their business practices are compliant. False advertising and misrepresentation can expose the business to lawsuits.

There are free online courses and training offered to help non-lawyer managers upskill.

Ms Mputhia is the founder of C Mputhia Advocates | [email protected]

PAYE Tax Calculator

Note: The results are not exact but very close to the actual.