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How election commitment protects small businesses

The Government is delivering its election commitment to make unfair contract terms illegal, protecting small businesses and the hard-working Australians they employ.

Small businesses and consumers often lack the resources and bargaining power to effectively review and negotiate terms in standard form contracts. Existing laws haven’t stopped the use of unfair terms, which remain prevalent in standard form contracts.

The Government will introduce legislation in the upcoming sitting period to strengthen unfair contract terms protections for small businesses and consumers.

The amendments will introduce civil penalty provisions outlawing the use of, and reliance on, unfair terms in standard form contracts. This will enable a regulator to seek a civil penalty from a court.

Additionally, a larger number of small business contracts will be afforded protection. This will occur by increasing the small business eligibility threshold for the protections from less than 20 employees to less than 100 employees, and introducing an annual turnover threshold of less than $10 million as an alternative threshold for determining eligibility.

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These reforms will help to improve consumer and small business confidence, allowing the small business sector to grow with confidence.

Comments attributable to Minister for Small Business, Julie Collins:

“The Albanese Government is serious about delivering on our better deal for small business and these reforms are a critical part of this agenda.

These changes will improve the long-term resilience of Australia’s small businesses and help them bounce back following significant challenges in recent years.”

Comments attributable to Assistant Minister for Competition, Charities and Treasury, Andrew Leigh: 

“Too many hard-working Australians are struggling with late payments, staff shortages and complex regulation, all while worrying about being pushed around by big clients.

Labor will give small business the protection that the Liberals couldn’t be bothered getting around to. We will deliver on our promises, and safeguard small business and contractors from exploitation.”

Source: ASBFEO

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