Business Legislation

Every business needs its own business name. You may also develop a colour scheme, logo or other images that help to identify your organisation to potential clients. Logos and images which incorporate the business name can be used on shopfronts, websites, promotional materials, staff uniforms and business cards.

Regardless of whether you decide on the name and associated graphics yourself, or if you employ a marketing specialist to design them, you need to protect your rights over your intellectual property to stop others from using them or replicating them in a similar fashion. On the other side of the coin, you also need to make sure that your business is not using names and graphics that are closely similar to another company’s (inadvertently or otherwise).

There are discrete sections of law that you can use to protect your ideas and images. Some laws apply throughout Australia and there may also be specific laws applicable to your state or territory. You will probably need to seek further advice from a lawyer.

Copyright Act

The Commonwealth Copyright Act 1968, and its regular amendments, protects the way that an idea of information is used or expressed, but not the idea or information itself. For example, if someone copies another person’s words from a book without permission, this could be a breach of copyright. But if someone takes the ideas expressed in a book and rewrites them in their own words, this is not a breach of copyright. Copyright law applies to a wide range of items such as art works, writings, music, films, broadcasts and computer programs.

Designs Act

The Commonwealth Designs Act 2003 includes provisions that grant the owner exclusive use of a registered design. Designs can be altered by other people sufficiently, however, so as to avoid infringement of the Act. For example, this is an issue that occurs in the fashion industry. If you decide to register your design(s), you should be aware that registration may not provide total protection. Seek professional advice and also take into consideration the cost factor involved.

Trademark Act

The Commonwealth Trade Marks Act 1995 covers trademarks and trademark rights. If you use a particular combination of letters, numbers, words, phrases, sounds, smells, shapes, logos or pictures to distinguish your business, then you may be able to protect it from being used by someone else by registering it as a trade mark. There is a cost for this. Trademarks are arranged through the IP Australia Office (see ‘References’ section).

Patents Act

The Commonwealth Patents Act 1990 sets out the laws that apply to patents. A patent gives the owner exclusive rights to any device, substance, method or process which is new, inventive and useful. It is expensive to register a patent and your invention must be worth the cost of the protection.

Confidential Information

Confidential information may include customer information, business plans and strategies, trade secrets (e.g., secret recipes or production methods that may give your business an edge over your competitors) or any other information that a business may not wish to disclose to others.

Within the Law of Torts under Common Law, anyone misusing your confidential information without permission may be sued.

A confidentiality clause in an employment contract prohibits employees from passing on sensitive information about your business to anyone outside of your business.

Each Australian company has the same rights and responsibilities under the Australian Consumer Law (ACL).

The Competition and Consumer Act 2010 (CCA) is an Australian law that dictates the way that companies are required to do business with their suppliers, competitors and their customers. The Act is intended to allow each business to compete purely on their merits, in a fair and open manner, while also making sure that consumers are treated fairly.

The ACL strives to help these businesses understand and apply their rights and responsibilities, which include:

To ensure a business meets fair trading regulations and consumer rights legislation, an organisation should develop policy and procedures relating to:
 Legislation and regulations:
•    Covid-19 requirements for businesses – QR Code, max number of persons permitted in the premises at any time
•    Competition and Consumer Act 2010
•    Australian Consumer Law (ACL)
•    Advertising Code of Ethics
•    Advertising standards
•    Product safety
•    Digital marketing standards
Policies and procedures could include, depending on the type of business operations:
•    Consumer Rights – repair, replace, refund problem solver:
•    compensation for damages and loss
•    refund policy
•    feedback policy and procedure
•    warranties and consumer guarantees
•    failure to disclose/silence
•    unsolicited consumer agreement
•    Information standards – product and packaging, ingredient labelling
•    Country of origin claim – food labelling, goods labelling, Australian grown and Australian owned
•    Dispute Resolution Procedure and Policy
•    Customer feedback policy and procedures.

Implement Safety/Work Health and Safety Practices
Legislation is related to Work Health and Safety Act 2011 and Work Health Safety Regulations 2011:
•    Workers compensation insurance, reporting incidents to Work Safe Australia
•    Codes of Practice – industry-based and activity-based, e.g. Confined Spaces COP, Manual Handling COP 
•    Work health and safety (WHS) policies and procedures relating to:
•    WHS policies and procedures – the responsibility of employer and employees
•    identifying hazards, assessing risk, hazard and risk control measures
•    safety induction of all employees
•    incident reporting system/procedure
•    depending on the type of business, this could include RSA Licences, Traffic Controller Licences, Crane Operator Licences, Fork Lift Licences, Drivers’ Licences, Food Handling Certificates
•    return to work procedure following safety incident/injury
•    recordkeeping requirements for risk register, hazard register, reported safety incidents
•    first aid officer, fire warden/floor warden
•    emergency evacuation procedures.
Knowing and getting insurance cover to manage and adequately cover any risk that may arise while conducting business. 
•    Business policy and procedures for insurance include:
•    Public Liability Insurance to cover injury and death to clients, customers and visitors to the workplace
•    Professional Indemnity Insurance to cover being sued for providing incorrect information or for a claim for the quality of work or non-compliance, which puts the customer into a difficult business situation or one that causes loss or damage
•    Product Liability Insurance – if your business develops a product, insurance may be required to prevent the business from being sued for injury or death resulting from your product’s faults
•    Business Insurance – business interruption insurance, contents insurance, building insurance (if the business owns the building), motor vehicle insurance
•    Workers Compensation Insurance to cover injury or death to employees in the course of their work

Industry codes of practice.

• Legislation is related to Corporations Act 2001, how a business operates

•    Constitution of the business (company)
•    Policy and procedures should document:
•    Code of Conduct of Board of Directors:
•    role of the board of directors
•    limitation of the role of directors
•    role of the management team
•    training of directors
•    attendance at meetings
•    authority and delegation
•    organisational hierarchy
•    governance of safety procedures and risk management.

Australian Competition and Consumer Commission (ACCC)

The ACCC is in place to regulate business and trade practices, promotions, fair trading and customer protection. Where required, the ACCC will take firm legal action against business entities that are deemed to have broken the law.

There are specific rules which businesses must follow when dealing with customers.

Consumer Guarantees

Under the Australian Consumer Law, your company essentially gives your customers a set of guarantees whenever they buy your goods or engage your services. These consumer guarantees are put in place to ensure that the consumer has enforceable rights should they purchase a service or a product that is defective, breaks or does not perform as it should.

If consumers have issues or problems with something they have purchased, and they feel that it does not meet consumer guarantees, then they are able to approach the vendor or manufacturer to attempt to remedy the situation.

The type of remedy will, of course, vary depending on the circumstances of the transaction; it might include repair, replacement, refund or provision of a more suitable or acceptable service.

Selling Goods to Customers

Whenever goods are purchased by consumers:

• They must be of completely acceptable and expected quality
• They must be completely fit for any reasonably expected and disclosed purpose
• They must entirely match their original description
• They must exactly match the original sample or demonstration item

Failing to Meet a Guarantee

If any service product does not meet a promised standard or guarantee, the client has the right to request and receive a solution. The nature of the remedy, and who it must be provided by, will depend on the nature of the issue.

If the issue is particularly serious, the client is entitled to ask for a refund or a working replacement.

A serious problem could involve:

• An issue that would probably have prevented or stopped a customer from buying the item if they had been aware of it
• Safety issue(s)
• Significant differences in the item or service provided than the original example or description
• An item being unsuitable for the purpose it was intended to meet and cannot be repaired in a reasonable timeframe

If the issue is minor, the client is not able to cancel the transaction and immediately ask for their money back. They are obliged to give the vendor a reasonable opportunity to fix the issue at no extra charge and in a suitable timeframe.

Example

A customer buys a hairdryer which does not work when it is switched on. The buyer takes the hairdryer back to the store they bought it from and requests a refund, which they are given.

Refusing to Repair, Replace or Refund

A customer does not have endless rights. They can only be given a remedy if a guarantee has not been adhered to.

A vendor is not required to provide recourse if the buyer:

• Changes their mind or decides that the product is not appropriate for them for some personal reason
• Later finds the purchased item for a lower price somewhere else
• Breaks or damages the goods through their own fault

The federal Industrial Relations system applies to most Australian employers and their employees. The Fair Work Act 2009 covers employers who are commercial companies.

Commonwealth Powers (Industrial Relations) Act 1996

This Act refers to the Parliament of the Commonwealth certain matters relating to industrial relations within the state of Victoria. These include matters of conciliation and arbitration for the settlement and possible initial prevention of work disputes, terms and conditions of employment for employees as well as issues relating to termination of employment.

Federal Awards (Uniform System) Act 2003

The Victoria Government introduced the Federal Awards (Uniform Systems) Act 2003 with the aim of establishing a more equitable system of industrial relations. The Act referred power to the Commonwealth Parliament, allowing it to pass laws permitting the Australian Industrial Relations Commission to make ‘common rule’ orders for Victorian industries.

Superannuation

Superannuation is a saving fund for a person’s retirement. Employers are required by law to make the payments to a Superannuation account. Superannuation funds are regulated under the superannuation guarantee legislation. Employer payments are usually based on a minimum percentage of an employee’s gross salary.

You will need to verify with the trustees of the fund (trustees are identified as the managing agent of the fund) that the percentage contributed by the employer is correct. A person can also add extra money to their superannuation fund if they want to. If you want to find out more about your superannuation fund and if it meets the appropriate standards, you can call Australian Prudential Regulation Authority (APRA). It is also important to remember that the ATO has important conditions that you and your fund manager must meet in regard to superannuation.

On 1 July 2021 the SGC rate rose from 9.5% to 10%. This will rise progressively until it caps at 12% in July 2025.

For more information on superannuation visit the ATO website https://www.ato.gov.au/rates/key-superannuation-rates-and-thresholds/?anchor=Superguaranteepercentage

Long Service Leave Act 1992

This Act establishes a minimum of thirteen weeks long service leave for employees after fifteen years of continuous service. An employee is entitled to receive their ordinary pay while on leave.

The Act applies to all employees in Victoria, except those covered by another act, federal award, certified or individual agreement that provides increased long service leave entitlements. The legislation applies to most Victorian employees working under the federal Fair Work legislation.

Outworkers (Improved Protection) Act 2003

This Act aims to ensure protection and fairness for outworkers in the clothing industry in Victoria. The Act increases the entitlements of outworkers and provides a simple low-cost process to recover money owing.

Child Employment Act 2003

This Act sets out general limitations relating to the employment of children, including the minimum age of employment and the number of hours worked.

The Act provides a system of permits to allow the employment of children under the age of fifteen.

The Act aims to ensure that work does not adversely affect a child’s education and that the health and safety of working children is protected.

Equal Opportunity Act 2010

Direct and indirect discrimination based on the following attributes is prohibited: age, breastfeeding, employment activity, gender identity, disability, industrial activity, lawful sexual activity, marital status, parental or carer status, any personal physical features, political beliefs, pregnancy status, race, religion, gender or sexual orientation.

Fair Work Act

The Fair Work Act 2009 came into effect on 1 July 2009. The National Employment Standards commenced on 1 January 2010.

Manufacturer’s Product Liability

Under standard contract law, if a manufacturer designs, develops and sells a faulty product, the rights of the buyer are the responsibility of the person or business who sold the product(s). The reason for this is ‘privity of contract,’ which simply put means that contract disputes can only be dealt with by those people within the contract, i.e., the seller and the purchaser. If a vendor eventually needs to refund the consumer for a faulty product, they can then seek recourse from the manufacturer, as they themselves have the same rights within their own contract.

Environmental protection

Businesses have a legal duty to meet general environmental protection obligations that apply to all businesses and citizen. This might include recycling program, waste tracking, waste levy, waste management tips, managing environmental risk and other climate risks, penalties for causing environmental harm, environmental licences and permits.

The Environmental Protection Act 1994 lists obligations and offences to prevent environmental harm, nuisances and contamination. Environmental Protection and Other Legislation Amendment Act 2020. Environmental Protection (Waste Management) Regulation 2000.

The two primary duties that apply to business are as follows:
General environmental duty – not to carry out an activity that may cause harm without taking measures to prevent or minimise the harm. This includes analysing the nature of the harm, sensitivity of the environment the business is operating in, current state of technical knowledge, likelihood of measures being successful and financial implications of taking different measures.
Duty to notify of environmental harm – to inform the relevant authority and landowners when environmental harm has occurred or might occur.

If you hold an environmental authority (EA) for an environmentally relevant activity (ERA), the business must meet these general environmental obligations in addition to the EA conditions. These requirements are in addition to the environmental obligations that everyone must comply with:
    Pay annual fees and submit annual returns (except for mining activities related to a mining claim).
    Comply with the conditions on your EA.
    Prepare a plan of operations for an EA relating to petroleum lease (for calculating estimated rehabilitation cost).
There are industry codes of practice available to help businesses comply with their general environmental duty for a range of activities, including ERAs. Codes include: Transport noise management, mosquito management, handling asbestos. 

Practical Tips

To ensure you do not breach ACL when dealing with your customers and other businesses, it is a good idea to create a complaint’s handling system. This will help you to comply with the ACL. The task of managing this system should be delegated to a specific person, usually in the Human Resources (People and Culture) Department.

They will be responsible for:

• Ensuring the complaints handling policy is understood by employees and that there is a process that employees must follow if they receive a complaint
• Clients understand how they can address any problems they might have with their purchased product or service without resorting to a formal complaint
• Complaints are regularly reviewed so that your organisation can identify any trends in complaints about specific people or products

Price-fixing

Price-fixing is when businesses collaborate with each other to keep prices at a certain level. This can increase prices throughout the chain of supply. It makes competition harder for smaller businesses and keeps prices high.

Market Sharing

Market sharing is when a business and its competitors split a market into sections, each taking a section for themselves. This is unethical and illegal, but there are occasionally circumstances where the ACCC will authorise the practise.

Predatory Pricing

Predatory pricing is when an organisation prices their goods or services well below the cost price. This may have a short-term impact on their own bottom line, but will also damage the commercial abilities of their competitors, thus putting competition out of business and leading to a higher market share in many cases.

In every business across Australia, there are Workplace Health and Safety (WHS) laws and regulations that need to be adhered to. These include things like duty of care, the ability to provide certified first aid to injured or unwell employees or customers, and the provision of fire safety equipment such as fire extinguishers and working fire alarms. It is good business practice to investigate and determine the regulations that you must follow and abide by.

If you are found to be non-compliant in your WHS obligations, you may find yourself subject to serious penalties including huge fines or even prison terms (in the most serious of cases). Many businesses engage WHS specialists, who can develop WHS manuals, policies and procedures (including record keeping), and recommend training courses for relevant employees. Engaging a specialist can be an expensive decision, but could ultimately save you many thousands of dollars in legal fees and penalties should there be a WHS incident which you could have prevented.

The following aspects of WHS can be found in all relevant Australian legislation:

• Positive views of WHS within the workforce, Employees understand the benefits
• Safe work systems must be implemented with the aim of risk being minimised or eliminated
• The health and safety of members of the public
• Employees must be given the right to have a voice and representation in WHS matters
• Inspections can be carried out and punishments for breaches handed to organisations

While it is one thing to be aware of knowledge about legal responsibilities, it is another thing to make sure that your organisation has the necessary policies and procedures in place to ensure compliance in all matters relating to legislation.

The consequence of a lack of compliance may be significant in that in the eyes of the law ignorance is no defence. In practical terms, everyone today is more aware than in the past of their rights in law and are more likely to pursue them.

There is a need for organisations to have access to good legal information and have in place effective compliance systems. An experienced professional should be engaged, particularly in larger companies.

Key compliance procedures include:

Following taxation and industrial relations principles and requirements
Setting up a compliance management system and ensuring to follow the applicable taxation systems applicable to the business type. Following industrial laws, principles and regulations to promote a healthy employee management system. Participating and holding consultation meetings to ensure the requirements are well covered. Updating policies and procedures as per the requirements.
Updating and maintaining legal records
Taking corrective actions, ensuring written documents, functions, processes, controls and tools are compliant to help an organisation comply with legal requirements and minimise harm to consumers due to violations of law. Train staff to maintain a compliant record system and ensure records are always kept up to date.
Investigating areas of non-compliance
Ensure the business identifies business, safety and product risk and implement appropriate control measures to mitigate the risk.Reporting incidences and by applying risk assessments strategies investigating areas of non-compliance and their impact based on the risks matrix
Monitoring
Ensure that goods and services meet business standards and compliance requirements (eg. Safe Work Method Statements for hazardous tasks). Review the relevant procedures to determine if they are adequate, correct or need improvement.
Taking corrective actions
Implement internal control procedures to reduce management and employees' theft, fraud, conflict of interest, and inappropriate business activity. Develop new policies and procedures to address the issues identified. Ensure all employees adhere to safe work practices and report all incidents using the incident management system, according to the operating procedures in the safety management system.

Negligence

Negligence is a rapidly growing area of legal action. The risk of being sued for negligence should be of particular concern to businesses selling skilled services.

Negligence does not refer to deliberate conduct. It is careless or unreasonable conduct. The careless conduct could comprise an action or failure to act in a situation.

There may be legal consequences for businesses that perform services negligently. Self-employed professionals and tradespersons or other skilled service sellers who perform work carelessly should be aware that they could be sued for breach of contract or for negligence. You do not need to breach an agreement or a contract to be sued for negligence.

The law relating to negligence is based mainly on common law rules. Common law negligence rules (with some variations), however, are now found in state and territory civil liability legislation. There is a statutory time limit for anyone wanting to sue for negligence. The time limit for personal injury claims is either three or six years, depending on the state or territory. The time limit, however, can be extended by courts in some circumstances. Claims for property damage or economic losses generally have time limits of six years.

Watch

This presentation from SafeWork NSW shows that reducing the amount of time small business owners spend trying to understand their WHS obligations by 30 minutes each week can save the NSW economy $800 million and increase compliance.

What Small Business Wants

Use the following questions to check your knowledge.

1. Describe ‘intellectual property.’
2. Explain the purpose of the ACCC.
3. Describe ‘price fixing.’
4. Describe ‘predatory pricing.’
5. Explain how your company could be ‘negligent’ in its business dealings.