Know your rights: unfair contract terms & small business

Ahh, running your own business – being your
own boss! But running a small business can be difficult.
There are people to manage, finances to balance, and that’s on top of doing your job. Its never easy. It means a lot of finding
clients, building contacts and knocking on doors. And that can mean a lot of contracts. Contracts with new clients, contracts with suppliers, contracts for services such as
internet or phone plans. Sometimes it can feel that everyone you deal with has a contract
to be signed. But sometimes contracts can be confusing and
can leave a small business in a very difficult position. Because of this, the Australian
government has introduced a law to protect small businesses against unfair contract terms. The protections apply for small businesses
that employ less than 20 employees, and receive contracts valued up to $300,000 or up to $1 million
for contracts longer than one year. So if you have been presented with a standard
form contract on a ‘take it or leave it’ basis and it includes an unfair term, that
term can be declared void, which means it cannot be relied upon. Examples of terms that may be unfair include
terms that allow the other business but not you to change or cancel the contract, allow
the other business but not you to limit or avoid their obligations, penalise you but
not the other business for breaking the contract. This law applies to contracts that are entered
into or renewed on or after 12 November 2016. If you think you’ve been presented with a
standard form contract that includes an unfair term, visit the ACCC website to find out what
your protections are under the law.

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