If you are going to operate as a retailer in today's climate, you and your staff must be 100% clear on the legal rights of your customers under Australian Consumer Law (ACL). If you or you or your staff are not up to speed , as a Harvey Norman franchisee discovered recently, it may cost you heavily not just in fines, but in legal costs, loss of business reputation and ongoing compliance costs. The consumer watchdog, the ACCC, is well resourced for keeping a close eye on what it considers to be breaches of the ACL and time and again comes down hard on offending businesses- and small and medium sized businesses are certainly not immune.

A Harvey Norman franchisee, Bunavit Pty Limited, operating out of Bundall in Queensland, was required to pay $52,000 in fines in respect of failings in respect of its obligations under the law. The franchise was told in no uncertain terms that its staff had misrepresented the Australian Consumer law to their customers - hardly the impression a business wants to give in a tight retail market !

In short, the sales staff gave false and inaccurate information to consumers who had purchased faulty goods - including denying the retailer's obligations and the customers' rights in respect of those faulty goods - even telling a customer that they would have to pay to get the goods repaired !

The legal obligations apply just as much to online businesses - and the consumer watchdog is very clear on that - so don't think you can hide behind your website. The ACCC says time and time again that it will come down hard on online and offline retailers who mislead their customers, particularly about their rights under the Australian Consumer Law and this case bears out once more that the ACCC does follow through.

This case brings to a total of $286,000 the amount of fines imposed on Harvey Norman franchisees in respect of false or misleading claims to customers about their legal rights when they purchase goods which do not comply with the Australian Consumer law. The case also shows that a retailer can't fall back on any excuses about how junior the staff handling the customers were - in the Bunavit case, no senior staff were involved.

It is also worth noting that Bunavit has now ceased trading. Whatever the commercial financial or other woes which led to this state of affairs, the action by the ACCC cannot have helped. A sulatary lesson indeed .

A retail business should make sure that ALL staff who are dealing with customers are properly trained in the Australian Consumer Law. The ACCC stated specifically that 'Businesses are expected to take appropriate and effective steps to ensure their staff understand the rights of consumers and the obligations of businesses under the consumer guarantees provided by the Australian Consumer Law .....'.

Counsel on Demand offers legal training tailored to retail businesses wanting to ensure that their staff do not fall foul of the Australian Consumer law. If you would like a no obligation , confidential chat about how we may be able to help you ensure that you and your staff understand the business's legal obligations to its customers, please call me, Polly Harding on 0401 816290 or email me on This email address is being protected from spambots. You need JavaScript enabled to view it.. I am always happy to talk and have considerable experience of handling consumer legal issues for small and large businesses.

 

 

The ACCC , the consumer watchdog, has demonstrated, once again, that it takes the protection of all consumers , including B2B consumers, very seriously.

Following enforcement action by the ACCC, the Federal Court has recently imposed heavy fines on Safety Compliance Pty Limited and personal fines on two directors and the general manager of the company for making false and misleading representations in breach of the Australian Consumer Law. The total fines amounted to $515,000 . The directors and GM were also banned from running a corporation for significant periods of time - in the case of one of the directors, for 8 years.

Safety Compliance sold wall charts and first aid kits to small businesses through telemarketing calls. The company incorrectly told businesses that workplace health and safety laws required businesses to maintain workplace wall charts and first aid kits of the same nature as those sold by Safety Compliance. The company also falsely represented to customers and potential customers that it was affiliated with or actually was a workplace health and safety agency. Each of these factors led the court to find that the company had misled customers into purchasing safety products from them.

These are very steep fines which would put many companies out of business.

As mentioned in previous legal updates this year will see the introduction of new laws protecting small businesses entering into standard form contracts where provisions of those contracts are considered to be unfair.

The case against Safety Compliance is a timely reminder that not only do small and medium sized businesses have extensive obligations to their customers under the Australian Consumer Law but that there are increasing protections for those small businesses . If you are a small or medium sized business owner, it is vital that you understand not only your obligations but how the law protects you also.

If you have any questions about how the Australian Consumer Law affects your business either as a supplier or as customer, Counsel on Demand can help.

Polly Harding - 0401 816290

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A couple of significant legal decisions for employers this week.

Employee or contractor?

All employers need to be familiar with the difference between independent contractors and employees - it's an area of the law fraught with difficulties for employers , particularly those seeking (intentionally or otherwise) to rely on the "contractor" label when in reality a contractor is an employee. The main risk of course for the employer is that the employee who is incorrectly labelled a contractor and treated as such is and remains entitled to the rights of any other employee , including in relation to unfair dismissal, notice of termination and a host of other entitlements.

A recent decision by the High Court has underlined the need for care in this area by employers. The Fair Work Act effectively provides that by telling an employee that he or she is a contractor does not make it so - when the reality is that the employee is an employee. The High Court ruled in the case of two employees engaged as cleaners in a holiday apartment block in Perth . The owner of the apartment block, Quest, had employed two cleaners as employees. However, Crest then attempted to remove their employee status by converting them to independent contractors engaged through a third party labour hire company, Contracting Solutions.

The High Court ruled that the introduction of a third party labour hire company did not take away their status as employees of Crest. They continued to perform exactly the same work , in the same way that they always had done and Crest could not argue that they were no longer employees of theirs , just because of the introduction of Contracting Solutions into the arrangements.

If you have any questions about the difference between contractors and employees and its implications for your business, please contact Polly Harding at Counsel on Demand. 0401 816290 or This email address is being protected from spambots. You need JavaScript enabled to view it..

Unfairly dismissed for being too fat ?

A case in the Fair Work Commission considered an employer's rights and obligations in the dismissal of an excessively overweight employee . The employee was a forklift driver with a dairy company, Parmalat and his weight exceeded the safe limit for the nature of his duties . The company had medical reports to support this position. In addition, the medical evidence demonstrated that the employee suffered from sleep apnoea.

The Commission ruled that Parmalat was entitled to dismiss the forklift driver and that an employer is entitled to require an employee to be generally fit and well and suitable to carry out the work for which they are engaged.

Significantly, Parmalat was able to demonstrate to the Commission that their internal policies and procedures were followed, and that they were engaged with and participated in a long period of consultation with the employee prior to dismissing him.This was highly relevant to the finding that the ultimate dismissal was fair.

The lesson here is to make sure that your internal policies are detailed and well thought out , that they are followed and , critically, that an employee is given adequate opportunity to remedy a situation as part of a consultation process.

If you have any questions about internal policies and procedures and their impact on the fairness or otherwise of a dismissal, contact Polly Harding of Counsel on Demand on 0401 816290 or on This email address is being protected from spambots. You need JavaScript enabled to view it..