The ACCC has demonstrated once again that it will focus on breaches of the Australian law by online retailers as much as bricks and mortar stores. Online retailer Ozsale which owns the websites Ozsale.com. OO.com.au, DealsDirect.com.au, amongst others, has this week paid a penalty of almost $11,000 following investigation by the ACCC into claims made on its websites in relation to the consumer rights of its customers.

Ozsale made statements in the websites' terms and conditions which had the potential to mislead customers about their rights under the Australian Consumer law . The Australian Consumer Law is very clear on the rights of consumers in the event of a major failure in a purchased item - Ozsale's terms and conditions , the ACCC claimed, attempted to mislead consumers about what those rights are.

Ozsale stated in its terms " Depending on the fault, you may be offered the choice of refund, repair or replacement of the item (subject to availability) ". The ACCC was concerned that this statement represented that the choice of remedies was always at the discretion of Ozsale , rather than of the consumer , when that is not the case.

The ACCC is particularly concerned about statements of this nature because a consumer would not necessarily know his or her true rights and could be misled into believing that the statement did in fact reflect the law. In addition, as the ACCC has emphasised, businesses can't exclude or modify those rights - through terms and conditions or otherwise.

Ozsale has provided a court enforceable undertaking in which it has accepted that the terms and conditions on its website were likely to give rise to concerns under the Australian Consumer Law.

As well as paying the fine, Ozsales has been required, in the form of a court enforcebale undertaking to take further steps to ensure that such breaches of the Consumer law are avoided in future :-

• it will publish a single refunds and remedies policy to be used across all online sales platforms which ACCURATELY REFLECTS CONSUMERS' AUSTRALIAN CONSUMER LAW RIGHTS
• put into place a compliance program, including training and a complaints handling procedure
• implement a mystery shopper program to provide ongoing monitoring of representations made by customer service staff when dealing with Australian Consumer Law issues.

Had Ozsale taken steps to understand the Australian Consumer Law prior to publishing its terms and conditions on the site , it could have avoided the no doubt significant costs involved in the ACCC investigation . In addition to the fine itself and the cost of the compliance steps outlined above, the publicity associated with an ACCC investigation can not be welcomed by any business looking to build its reputation and establish a loyal customer base.

Counsel on Demand lawyers can help your business understand its legal obligations to its customers whether you trade online, as a bricks and mortar business or as a combination of the two . If you have any questions about your business's obligations to its customers under the Australian Consumer Law, please call Polly Harding for an obligation free confidential chat. She can be reached by mobile on 0401 816290 or by email at This email address is being protected from spambots. You need JavaScript enabled to view it..

 

 

 

 

 

 

 

 

With the recent horrendous weather conditions, all along Australia's east coast, employers will no doubt be asking what rights they and their employees have if there is no useful work for them to do because of extreme weather conditions.

An employer can send employees home if there is no useful work for them to do because of

• equipment break down;
• natural disaster (including floods, bushfires and tropical cyclones);
• industrial action.

This is known as a stand down but it is only a stand down if the reason for the stand down was out of the employer's control. So if the equipment has broken down because it hasn't been serviced or hasn't been repaired, it would be more difficult for the employer to argue that it was out of his or her hands.

Employees certainly can't be stood down without pay just because there is not enough work.

The employer is not under an obligation to pay an employee during a stand down. However, the employer can be flexible in this situation so that an employee can be paid. For example, the employer may consider letting employees take the time as leave or to work at another location such as from home or at another work site.

Eager followers of Counsel on Demand Legal Updates (too many to count !) will be aware of changes to unfair contract law terms which will take effect in November 2016 . The changes  are primarily designed to protect smaller businesses from unfair terms in standard form contracts.

Until now, the protections have only applied to mum and dad consumers. However, the new laws mean that small businesses can take advantage of the protections offered . At the same time, a small business which enters into a relevant contract with another business (however small or large the other business) won't be able to rely on an unfair term which the small business tries to impose - it's a two way street. It's not simply a David and Goliath scenario.

The obvious question is 'what is an unfair contract term?". As the law doesn't currently apply to business consumers , for now, we can only look to cases brought in respect of  mum and dad consumers for examples . Telecommunications services provider Exetel was recently pulled up by the ACCC , the consumer champion , in respect of changes to its fixed term residential broadband plans.

The contract in question , included a clause saying that Exetel could vary any part of the agreement for any reason. Exetel then told customers that they must either change their broadband plan or terminate their Exetel service without being compensated for the lost services . The ACCC considered that the clause and associated action was unfair and Exetel subsequentaly agreed to compensate consumers for loss of service - which had the clause remained , they would not have been required to do. So although customers had agreed to a contract which said that the service could be varied at any time , on Exetel's whim, effectively, that term was considered unfair and it didn't stick.

These are just some of the things your business should be doing :-

• Start now - both the consumer watchdog, the ACCC and ASIC have explicitly stated that they will start reviewing contracts as soon as the law takes effect.
• Consider what standard form contracts your own business uses for its customers.
• Consider what standard form contracts you enter into with other businesses, using their standard form contracts.
• Make sure you understand what you are looking for - what is likely to be an unfair term ?
• Prepare - if you have annual contracts which automatically renew, they will be caught.
• Make sure you understand the effect of an unfair contract term - this could be critical if a supplier , for example, is trying to impose unfair terms on your business. That understanding could give you a significant commercial edge.
• If any of your own terms are unfair, understand that they may well not give you the protection you think they do - be prepared and be ready to make changes.

 The new laws apply to a standard form contract when:

• One party to a contract is a small business - that is a business with less than 20 employees, including regular casuals ; and
• The contract is for the sale of goods and/or services (or an interest in land); and
• The value of the contract is less than $300,000 for an upfront one off price or, if the contract is for more than 12 months, eg a services agreement, up to $1M.