Escort agencies facilitate the provision of sex workers and the services they offer to clients. These services are often made available through a website or a phone on premises not made readily available by these agencies. This industry, as well as the people working in it, are highly regulated. Therefore, they must understand relevant laws when advertising and operating their services. In this article, we will take a closer look at legal considerations individuals should have when starting an escort firm business.
Important legal considerations
Business structure
When starting any enterprise, it is vital to consider the business structure. It is because the structure can affect the following:
- Responsibilities
- Asset protection
- Business costs
- Liability
- Taxes
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Licensing
The licensing and legal regulation regimes concerning this industry differ in various states or cities. Some states require companies to apply for a license before they can start their operation or manage escort agency businesses. In other places, individuals need to apply for a service provider’s license through the local business licensing bureau. The application needs to specify that they plan on operating escort agencies. Companies also need to include the following supporting documents:
- Information on the entrepreneur’s liabilities and assets
- Business plan
- Cash flow forecasts for the first twelve months of the enterprise
- Copies of the contract to buy the enterprise, if the individual is purchasing an existing company
- Copies of lease and/or the agreement to transfer the lease to the buyer if they will rent their company’s premises. If the entrepreneur plans to operate their escort company with other individuals (associates or partners), each person has their own license
Operating as an agency without the right license attracts severe penalties, as well as a possible prison time of up to five years.
Advertising regulations
Like licensing requirements, state laws will determine how people are permitted to advertise their company’s services. Advertising materials like business cards, photographs, and brochures should:
- Be in a format approved by governing bodies
- Contain SWA or Sex Work Act
- The agency’s relevant license number
To know more about the Sex Work Act or Prostitution Law, check out https://en.wikipedia.org/wiki/Prostitution_law for details.
In some places, the law sets out ad requirements relating to:
- Pictures or photographs of individuals. In particular, images must only show the shoulders and head of the individual
- Ad materials on the World Wide Web. In addition, any ad needs consent with specific material restrictions, and they should obtain written permission from the individual used in the ad material
- Size and form of print ads
- The text used in the ad content
Staff handbook and Contractors and Employment Agreements
Whether firms are engaging escort professionals as independent contractors or employees, they need to have employees or independent contractor agreements in place. The agreement sets out the conditions and terms on which their workers provide services to the agency. The agreement should detail:
- The obligations and rights of both parties
- Termination and entitlement conditions as per the NES or the National Employment Standards
- General standards like hours of work
- Remuneration
As an owner of an escort company, they also have some obligations, regardless of whether they have workers, independent contractors, casual staff, or freelancers. They are required to provide a:
- A very safe environment, free from intimidation and violence; without risk to health for workers, clients, and subcontractors
- A very safe environment for sex workers, contractors, and office staff, as well as visitors and clients
Businesses should, therefore, have a thorough safety practices and communication in their staff handbook. Such activities should include:
- Confirming departure and arrival times
- Maintaining regular communication with workers
- Make sure workers have a working phone number and are contactable
- Hygiene practices need to be followed
- Maintaining customer confidentiality
- Procedures to report possible unsafe or violent situations
Important takeaways
Before starting an agency, it is vital to choose the best business plan or structure for situations and have the vital legal documents drafted and signed. These include the agency’s relevant online site documents and contracts, as well as employment agreements.
Companies should also be aware of any rules and adhere to state-specific regulations when managing and operating an agency. If needed, organizations are also required to get the right license. When advertising services, they need to comply with the requirements set by governing bodies. Any business needs to complete these requirements before it can operate legally, and escort service providers are no exception.
