prbl004 - lecture 8.pptx [read-only]

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Lecture 8

Introduction to Consumer Law

&

Introduction to Employment Law

2010 Thomson Legal & Regulatory Ltd. All Rights Reserved.PowerPointslides to accompany Managers and the Law: A Guide for Business Decision Makers, 3rd

Edition. Lynden Griggs, Eugene Clark and Ian Iredale

CONSUMER LAW



LEARNING OBJECTIVES

• Obtain an understanding of the laws that regulate consumers

• Appreciate the role of product standards, product defects and implied warranties in consumer lawconsumer law

• Recognise the changing face of consumer law.

2010Thomson Legal & Regulatory Ltd. All Rights Reserved.PowerPointslides to accompany Managers and the Law: A Guide for Business Decision Makers, 3rd


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RELEVANCE

• Businesses must be aware that no longer necessarily correct to say buyer beware.

• Government policy has been to increase consumer protectionconsumer protection



STRUCTURE

• Consumer Protections Provisions of Trade Practice Act (TPA), Fair Trading Act(FTA) pre 2011 and the Australian Consumer Law as set out in the Australian Competition and Consumer Act 2010

• Manufacturer and Product Liability Laws

• Industry and State specific aspects



The Modern approach (cont)

• Fair Trading Acts

– state legislation

– mirrors Commonwealth Trade Practices Act

– covers goods and services

– covers more than sales – acquisition

– defines consumer transaction

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• Transaction specific legislation

– state legislation

– covers specific forms of conduct e.g. Door‐to‐door sales

• System of redress – small claims jurisdiction in each State and Territory

NOTE after 2010 there is the AUSTRALIAN CONSUMER LAW – Competition and Consumer Law 2010 (Commonwealth legislation)

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The law pre 2011‐How the TPA can be harnessed

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The law pre 2011‐How the TPA can be harnessed

Regulation of selling techniques• Dishonest conduct prohibited• Bait advertising prohibited. Items advertised must be available in

reasonable quantity• Offering gifts without intending to supply them is prohibited

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• Trading stamps prohibited in most States and Territories• Pyramid selling prohibited• Referral selling prohibited• Inertia selling prohibited and discouraged

A sale is not the only form of consumer transaction• The TPA introduces the concept of acquiring goods which is much wider

than a sale• The TPA (and states Fair Trading Acts) TPA cover all forms of acquisition,

including leasing, hiring, renting are all transactions regulated by the modern legislation

The law pre 2011 –How the TPA can be harnessedConsumer protection extends beyond the immediate transaction

• Implies manufacturer’s warranties where goods supplied to consumer via third party such as retailer

• Manufacturer warranties do not apply where sale is direct from manufacturer to consumer

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• Manufacturer liability extends to proving adequate repair facilities or spare parts

• ‘Manufacturer’ has a wide meaning – can extend to importer

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How the TPA can be harnessed (cont)

Regulation of product safety

• Product safety is a fundamental consumer right ‐ primarily a State responsibility but Commonwealth involved under extended constitutional reach

• Minister administering TPA empowered to warn of risk of injury from specific goods and declare them unsafe

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• Corporations prohibited from supplying goods that do not comply with consumer product standards

• Safety standards developed by Standards Association can be adopted as legislative standards

• Product information (not necessarily safety related) standards possible under TPA

• Retrospective action available via compulsory product recall power

Scope of the Trade Practices Act (TPA)

The TPA is principally concerned with:

• Regulating RESTRICTIVE TRADE practices to produce greater competition and efficiency in the market for the benefit of consumers; and

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• Protecting the interests of consumers of goods, services and land against ‘UNFAIR PRACTICES’.

Application

• For the TPA to apply:

– There has to be a Corporation, or an individual caught under s.6;

– There has to be a supply of goods or services in the course of business; and

– A Consumer, being a person who (TPA s. 4B) acquires goods or services (of any

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, g p ( ) q g ( yvalue) of a kind ordinarily acquired for personal, domestic or household use; or a commercial road vehicle (of any value); and

– The goods or services were not acquired for resupply, or use or transformation in trade or commerce

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TPA Pt IVA – Restrictive Trade Practices

Prohibition of Unconscionable Conduct

• The unconscionability provisions provide consumers (and small business) with protection from unconscionable (unfair) conduct. S 51:

– defines unconscionability in general terms and applies the common law

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– defines unconscionability in general terms and applies the common law principles from Commercial Bank of Australia Ltd v. Amadio (1983));

– prohibits corporations from engaging in unconscionable conduct when supplying goods or services to consumers;

– provides small business with a remedy for unconscionable conduct by a corporation where the commercial transaction does not exceed $1m

TPA Pt IVA ‐ Prohibition of Unconscionable Conduct

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Misleading or Deceptive Conduct – TPA Part V Division 1

s. 52 • Section 52 is made up of three elements:

– Conduct by a corporation (or person who is caught by s. 6);

The activity of trade or commerce and

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– The activity of trade or commerce; and

– Misleading or deceptive conduct, or conduct likely to mislead or deceive.

• Section 52 is not restricted to consumers and can be equally enforced by competitors or suppliers against other competitors or suppliers (Eveready Australia Pty Ltd v. Gillette Australia Pty Ltd [2000]).

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Misleading or Deceptive Conduct –s. 52 TPA (cont)

• Mere confusion does not amount to conduct that is misleading or deceptive.

• It is enough if the conduct is likely to deceive or mislead although mere confusion is not enough (McDonald’s System of Australia Pty Ltd v McWilliams Wines Pty Ltd (1980); Parkdale Custom Built Furniture Pty Ltd v.

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Puxu Pty Ltd (1982)).

• future representations without reasonable grounds for making the representations shall be misleading .

• The onus of proof is on the person who made the representation to show that they had reasonable grounds for doing so.

Specific False Representations ‐ s. 53

• Breach of any section a criminal offence (s. 79), as well as providing civil remedies. It prohibits the making of false representations in with the promotion and supply of goods and services in 11 subsections:

– that goods and/or services are of a particular standard, quality, value, grade, etc when this is not the case (s. 53(a);

– that goods are new s. 53(b));that goods or services have been ordered (s 53bb)

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– that goods or services have been ordered (s. 53bb);– Representations as to characteristics, uses, etc of goods and services (s. 53(c));

– Representations as to sponsorships (s. 53d));– False representations as to price (s. 53(e)); – False representations as to facilities for repair or spare parts (s. 53(ea));

– False representations as to origin of goods (s. 53(eb));– False representations concerning the need for any goods or services (s. 53(f));

– False representations as to condition, warranty etc (s. 53(g)).

Manufacturer’s Liability‐Pt V, Div 2A

• Part V, Div 2A allows consumers to sue the manufacturer, and in some cases theimporter, of goods if:

• The goods are defective; and

• The goods have been supplied through sale, exchange, lease, hire or hire‐purchase.

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• Conditions equivalent to the sale of goods legislation are imposed on manufacturers, i.e.,

‐ fitness for purpose (s. 74B);

‐ correspondence with description (s. 74C);

‐merchantable quality (s. 74D); and

‐ sale by sample (s. 74E).

• A manufacturer must also ensure availability of repair facilities and spare parts (s. 74F).

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Product Liability ‐ Part VA

• Part VA imposes STRICT LIABILITY on manufacturers and importers of defective goods that cause personal injury or property damage.

• There is no need to prove negligence on the part of the manufacturer.

• In determining the safety of the goods, the courts can look at (s. 75AC(2)):

– The manner in, and purposes, for which the goods have been marketed;– Packaging;

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– The use of any mark;– Instructions or warnings;– What could reasonably be expected would be done to the goods;– The time of supply.

Product Liability ‐ Part VA (cont)

• While liability is strict, the following defences are available to a manufacturer or importer of goods (s. 75AK):

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– The defect occurred elsewhere in the distribution chain;

– The goods had the defect only because they complied with a mandatory standard;

– Scientific or technical knowledge at the time of supply was not capable of detecting that type of defect;

– The goods formed part of other goods and the defect was only attributable to the design of the finished product.

Uniform Consumer Protection

• In 2011, the new Australian Consumer Law (‘ACL’) came in to force, based on recommendations of the Productivity Commission reviews

All d i d f b i i 1• Alleged misconduct of businesses prior to 1 January 2011 will still be dealt with under the laws in place at the time (TPA or FTA/equivalent)

• Slides address old sections with common law and ACL sections

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Federal Consumer Protection Laws – pre‐2011

• TPA 1974

• General rule – only applied to conduct of corporations

• Exceptions: sole traders, partnerships or p , p punincorporated bodies:

– operating in interstate trade/commerce; or

– trans‐Tasman markets; or

– overseas trade; or

– supplying goods or services to Cth authorities; or

– in the territories.

Federal Consumer Protection Laws – pre‐2011

• TPA 1974

• Supply of goods/services extends to sale, lease, hire or hire purchase– Consumer (s 4B)

• Goods and services <$40,000; or$ , ;

• Goods and services for ‘personal, domestic or household use’

• Cannot exclude implied terms under TPA

• Implied terms to a consumer contract ‘good’– Meets description (s70(1))

– Merchantable quality (ss 66(2) and 71(1))

– Fitness for purpose

Federal Consumer Protection Law –ACL – Who is applies to?

• S3 Consumers [previously TPA s4B]– No longer reference merely to $40,000 ceiling

– Focus now on :• Price ceiling value of goods (still $40000)

• Kinds of goods and services acquired (objective test)

• Purpose for which goods and services acquired (subjective test)

•

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Federal Consumer Protection Laws – pre‐ACL Misleading Conduct

• TPA 1974, s52 ‐

“(1) A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

(2) Nothing in the succeeding provisions of this Division shall be taken as limiting by implication the generality of subsection (1).

Federal Consumer Protection Law –ACL – Misleading and Deceptive

Conduct

• Misrepresentation under the new legislation (ACL) is covered in section 18 (1) and (2): A

t t i t dperson must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive ...

Federal Consumer Protection Law –ACL – Misleading and Deceptive

Conduct

• Difference to s52 of TPA/FTA equivalents is that the focus is now on persons and notthat the focus is now on persons and not merely on corporations

• Misleading and deceptive conduct remains a ‘strict liability’ offence

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Federal Consumer Protection Laws – Pre‐2011

• Statutory Misrepresentation

• TPA 1974, s53– A corporation shall not, in trade or commerce, in connexion [sic]

with the supply or possible supply of goods or services or in connexion [sic] with the promotion by any means of the supply or use of goods or services:

• (a) falsely represent that goods are of a particular standard, quality, value, grade, composition, style or model or have had a particular history or particular previous use;

• (aa) falsely represent that services are of a particular standard, quality, value or grade;

• (b) falsely represent that goods are new;

• (bb) falsely represent that a particular person has agreed to acquiregoods or services;

• (c) represent that goods or services have sponsorship, approval, performance characteristics, accessories, uses or benefits they do not have ...

Federal Consumer Protection Law –Misrepresentations under the ACL

• Misrepresentation is added as specific types of prohibited behaviours defined in ss29 & 30

• Definitions and understanding of• Definitions and understanding of misrepresentation drawn from State FTAs

• Specific focus on:

– Testimonials about product or service;

– Extended warranties;

– Conditions and warranties.

Federal Consumer Protection Laws –pre‐2011 Unconscionable Conduct

• TPA 1974, Part IV A, ss51AAB – s51ACAA –‘Statutory unconscionability’

– s51AA – meaning within unwritten laws of St t /T it iStates/Territories

– s51AAB – non‐application to financial services

– s51AB – unconscionable conduct with consumers

– s51AC – unconscionable conduct in business transactions

– s51ACAA – concurrent operation of State/Territory laws

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Federal Consumer Protection Laws –Unconscionable Conduct under the ACL

• SS20 – 22

– s20 – meaning within unwritten laws of States/Territories [ i l 51AA TPA][previously s51AA TPA]

– S21 – unconscionable conduct in consumer dealings [similar to s51AB of TPA]

– S22 – unconscionable conduct in business transactions [similar to s51AC TPA]

EMPLOYMENT LAW



LEARNING OBJECTIVES

• Identify sources of employment obligations

• Define the nature of employment relationship

• Understand the duties of the parties

• Recognise the role of legislationRecognise the role of legislation



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STRUCTURE

• Formation of employment relationship

• Duties owed by parties

• Outline of legislative provisions



SOURCES OF EMPLOYMENT LAW

• Common Law

• Statute

• Industrial Awards

• Industrial Tribunals

• Custom within particular industries



Legal Concept of Employment

• ‘Employment’ at law is the term given to the work relationship between an ‘employer’ and an ‘employee’ created by a contract of employment.

• The distinction between a relationship of employment and• The distinction between a relationship of employment and other types of working relationships is extremely important because of the legal consequences that flow from the categorisation of the work relationship.

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Common Law Tests

• Work relationships at common law may be divided into two (2) main categories:‐

C t t f S i dContracts of Service; and

Contracts for Services.

Common Law Tests cont.

• The Control Test;

• The Integration / Organisation Test;

• The In Business / Economic Reality Test;

• The Ready Mix Concrete Test; and

• The Multi‐Factor Test.

Types of Employment

• Even once a particular work relationship can be categorised as employment, it remains to consider what type of employment relationship the contract gives rise to.

• The distinction is extremely important because of the legal consequences that flow from the categorisation of the work relationship.

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Types of Employment

• Labour hire employees

• Employees under contracts of indefinite duration

• Part‐time permanent employees

• Casual employment

• Outworkers• Outworkers

• Dual legal status

• Independent contractors

Duties and obligations owed by the Employer to the Employee

• Duty to provide work

• Duty to pay remuneration

• Withdrawal of work by employer

• Duty to ensure safety of employees

• Duty of care

• Duty to indemnify

Duties and obligations owed by the Employee to the Employer

• Duty to perform work in a skilful and competent manner

• Duty to obey employer’s lawful commands

• Duty to perform faithful services

• Duty not to act in a manner contrary to the employer’s interest

• Obligation to maintain confidentiality after termination ofObligation to maintain confidentiality after termination of employment

• Duty to disclose information to the employer

• Doctrine of restraint trade

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TERMINATION PURSUANT TO TERMS OF CONTRACT

• Where the parties have, by express terms, specified the grounds on which the employment contract can be terminated, lawful termination is limited to those grounds.

• A Court will not imply a term allowing for termination that contradicts or even adds to the express terms. See NSW Cancer Council v Sarfaty (1992) 44 IR 1 and McClelland v Northern Ireland General Health Services Board [1957] 2 All ER 129

TERMINATION UPON NOTICE

• Express term re. notice

• ‘Reasonable notice’ where contract silent

• Section 117 minimum notice provision

• Employee’s excluded from s 117

• Withdrawal & Waiver

• Pay in Lieu

SUMMARY DISMISSAL

• No obligation to give notice, or make payment in lieu of notice

• Conduct ‘must be such as to show the servant to have disregarded the essential conditions of the contract of service’. See Laws v London Chronicle (Indicator Newspapers) Ltd [1959] 2 ( p p ) [ ]All ER 285

• Regulation 1.07 Fair Work Regulations 2009 – ‘serious misconduct’

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SUMMARY DISMISSAL‐ Grounds

• Drunkenness

• Fighting

• Verbal Abuse

• Wilful and unjustified disobedience of lawful command

• Misuse of Employer’s property

• Dishonesty

• Giving false information

• Unexplained underperformance of duties

• Sexual Harassment / Assault

CONSTRUCTIVE DISMISSAL

• Common law constructive dismissal different from ‘a dismissal at the initiative of an employer’ for the purposes of FWA Unfair Dismissal provisions

• Employer conduct significant breach going to root of the contract, or which shows that employer no longer intends to be bound by essential terms ‐ Western Excavating v Sharp[1978] QB 761

Other reasons for termination:

• Abandonment

• Death of party

• Change of employer

• Frustration

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Unfair Dismissal

• At common law, dismissal need only be wrongful or unlawful by reference to the contract

• The legislative provisions are directed to whether the dismissal was harsh, unjust or unreasonable, regardless of whether it was lawful at common law or not

Unfair Dismissal ‐ Eligibility

• Only ‘national system’ employees

• An employee must have completed a ‘minimum employment period’ and if he/she earns more th th ‘hi h i th h ld’ b d bthan the ‘high income threshold’, be covered by a modern award or enterprise agreement.

• An employee must have been ‘dismissed’

• Some employees are excluded (see inter alia Small Business Fair Dismissal Code)

Unfair Dismissal Section 387 Fair Work Act 2009 (Cth) – In considering whether it is satisfied that a

dismissal was harsh, unjust or unreasonable, FWA must take into account: • (a) whether there was a valid reason for the dismissal related to the

person's capacity or conduct (including its effect on the safety and welfare of other employees); and

• (b) whether the person was notified of that reason; and • (c) whether the person was given an opportunity to respond to any

reason related to the capacity or conduct of the person; and • (d) any unreasonable refusal by the employer to allow the person to• (d) any unreasonable refusal by the employer to allow the person to

have a support person present to assist at any discussions relating to dismissal; and • (e) if the dismissal related to unsatisfactory performance by the person‐‐

whether the person had been warned about that unsatisfactory performance before the dismissal; and

• (f) the degree to which the size of the employer's enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

• (g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

• (h) any other matters that FWA considers relevant.

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Unfair Dismissal – Remedies

• Compensation

• Reinstatement

• Injunctions

• Pecuniary Penalties

Other Protections – Adverse Action in Respect of Workplace Rights

• Section 340(1) ‐ employers cannot take ‘adverse action’

• Section 341(1) ‐ ‘workplace right’

• Certain dismissed employees not ‘dismissed’ for purposes of the provisions

Other Protections – Remedies for Breaches of Part 3‐1

• Section 365 mediation / conciliation conference (pre‐court procedure)p p

• Conference mandatory for dismissed employees

• Compensation, reinstatement, pecuniary penalties and injunctions

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UNLAWFUL TERMINATION Section 772 sets out prohibited grounds of dismissal:

(a) temporary absence from work because of illness or injury of a kind prescribed by the regulations;

(b) trade union membership or participation in trade union activities outside working hours or, with the employer's consent, during working hours;

(c) non‐membership of a trade union; (d) seeking office as, or acting or having acted in the capacity of, a

representative of employees;representative of employees; (e) the filing of a complaint, or the participation in proceedings, against

an employer involving alleged violation of laws or regulations or recourse to competent administrative authorities;

(f) race, colour, sex, sexual preference, age, physical or mental disability, marital status, family or carer's responsibilities, pregnancy, religion, political opinion, national extraction or social origin;

(g) absence from work during maternity leave or other parental leave; (h) temporary absence from work for the purpose of engaging in a

voluntary emergency management activity, where the absence is reasonable having regard to all the circumstances.

Federal Anti‐Discrimination Laws

• Racial Discrimination Act 1975 (RDA)

• Sex Discrimination Act 1984 (SDA)

h d l ( )• Human Rights and Equal Opportunities Commission Act 1986 (HREOCA)

• Age Discrimination Act 2004 (ADA)

• Disability Discrimination Act 1992 (DDA)

• Fair work Act 2009 (FWA)

Discrimination: The Employment Context

• Consider type of discrimination

• Consider the circumstances in which• Consider the circumstances in which discrimination takes place

• Identify the relevant legislation

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Statutory Institutions – Fair Work Australia

Independent body with power relating to:

• the safety net of minimum wages and employment conditions through Modern Awards and NES disputes

• enterprise bargaining

• industrial action

• dispute resolution

• termination of employment

Statutory Institutions –Functions of Fair Work Australia

• Modern Awards – s 156‐157

• Enterprise Agreement Bargaining Orders – s 229 ‐231

• Workplace Determinations

• Minimum Wages through modern awards and national minimum wage orders ‐see 282 and followingsee 282 and following

• Equal Remuneration Orders.

• Transfer of Business – s 318‐320

• General Protections disputes– s 368‐369 and 374

• Unfair Dismissal applications – s 398‐399.

• Industrial Action ‐ Part 3‐3

• Stand Down – ss 524 – s 526

• Unlawful Termination claims – s 773

Statutory Institutions – Fair Work Ombudsman

• The objective is to promote harmonious workplace relations through education and compliance – s 682(1)(a)

• The FW Ombudsman’s functions include (s 682):‐

Monitoring compliance;

Carrying out investigations and bringing legal proceedings; and

Educating employees, employers and organisations about their rights and responsibilities.

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Statutory Institutions – Federal Court of Australia (incl. FMC): Orders

Court may make any order the court considers

appropriate including but not limited to (s 545):‐

• an order granting an injunction, or interim injunction,;

• an order awarding compensation;

• an order for reinstatement of a person.

National Employment Standards (NES)

• Hours of work

• Parental Leave

• Annual Leave

• Personal/Carers Leave

• Flexible work arrangements

• Long service leave

• Public holidays

• Notice of termination

• Redundancy pay

• Community service leave

• Provision of Fair Work Information Statement

The NES do not deal with minimum wages. These matters are dealt with

through the making of awards and National Minimum Wage Orders.

National Employment Standards (NES)

• The guarantees provided by the NES override a less beneficial employment contract, modern award or enterprise agreement – the NES cannot be excluded.

• With the exception of parental leave, the NES apply only to National System employees.

• Provisions relating to parental leave apply to all employees across Australia.

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