The Albanese Government’s additional protections for small businesses and consumers take effect today outlawing unfair contract terms to help level the playing field in negotiations between big corporations and both small businesses and consumers.
These reforms give regulators the power to seek a court penalty for businesses that include unfair terms in standard form contracts.
The protections also cover more small business contracts by lifting the eligibility threshold from less than 20 employees to less than 100 employees, or annual turnover of less than $10 million.
Small businesses and consumers often lack the resources and bargaining power to negotiate contracts, and previous laws against unfair terms did not provide adequate protections.
While big businesses previously only risked an unfair term being declared void, our stronger protections means that businesses can now face substantial penalties for using unfair terms and therefore will be more motivated to ensure their contracts are fair.
Quotes attributable to the Minister for Small Business, Julie Collins:
“Big firms who are doing the right thing have nothing to fear from the new laws, but these changes will help small businesses stand up to big corporates who use unfair terms in take‑it‑or‑leave‑it contracts.
Banning unfair contract terms will make life better for small business and consumers, and improve productivity in the economy.
Labor is the party of small business, and we’ll continue to make sure small businesses are at the centre of our decision making.”
Quotes attributable to Assistant Minister for Charities, Competition and Treasury, Andrew Leigh:
“The Albanese Government values the fair go, fair play, and fair competition and that’s exactly what these changes deliver. For many small businesses, there’s no clearer example of unfairness than a big company handing you a standard form contract loaded with unfair terms and being told to ‘like it or lump it’.
When big business can push around small suppliers, consumers suffer as well. These reforms will help level the playing field by protecting small businesses and benefiting consumers.
The Coalition said they would act on this but never did. Ours is a Labor Government that believes in fairness and delivers on our promises.”