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Everybody needs to follow the law. Even businesses have their own set of rules and regulations they need to abide by. Much like any other member of the public, if a business doesn’t comply with regulations, then it could find itself in trouble.
If you’re a business owner, being aware of the laws your business needs to follow is one of your most important duties. Although, it can be confusing to keep up with all the laws and regulations. After all, there are a lot of them.
When you have the right legal help, keeping up with business regulations becomes a lot easier. That’s where we come in – let’s take a closer look at the laws that impact your business and how you can comply with them.
How Do Government Regulations Affect Businesses?
There’s a reason we say, business and the law go hand in hand. From the moment you register your business, to when you decide to shut down your business (or sell it) there are strict rules that need to be followed.
A few ways government regulations affect businesses include:
- How customers and clients are treated
- The quality of the products or services you sell
- What kind of information your business collects and what can be done with it
- The employment rights your staff are entitled to
- Contracts and other types of legal agreements
- Business registration, fees and auditing
At almost every turn in your business journey, there will be laws you need to comply with. It’s best to familiarise yourself with them and seek expert legal advice – the last thing you want is your business in trouble because you weren’t following a rule.
Why Do Governments Regulate Businesses?
The answer is simple. Businesses need to be regulated in order to create a fair space for everyone. Without regulations, there would be no way to reign businesses in.
This means, minimum standards and codes of practice wouldn’t exist. Without proper rules, business owners would need to do what they think is best. People tend to have very different ideas on what is right, so as you might imagine– this would likely create a lot of conflict.
Essentially, without laws the business world would be chaos. Laws set the bar for what’s right and wrong, what can be done and what cannot. That way, everyone can be protected and things can run smoothly.
What Are The Regulations In Business?
Regulations exist in most (if not every) corner of the business world. They’re pretty hard to avoid however, it’s important to keep in mind that not every single regulation out there is going to apply to your business. Certain regulations depend on matters like the size of your business, its location and what industry it operates in.
As such, it’s always best to talk to a legal expert about the kind of regulatory compliance measures your business needs to be taking. Getting advice that’s catered specifically to your business is always a wise idea.
That said, there are some regulations most businesses will need to be aware of – let’s take a look at a few of the common ones.
Business Registration
When you decide to start a business, you have to register it. The type of registration process you will need to undertake will depend on the kind of business you choose to run. In Australia, a sole trader, partnership and company are the three most common types of businesses.
To register as a sole trader or in a partnership, you will need to attain an Australian Business Number (ABN). This is a pretty simple process which can be completed for free online (in a partnership, each partner will need their own ABN). Once you’ve received your ABN, the next step is to register a business name, this part is only required if you’re going to run your business with a name that is different from your personal one. After that, you’ll be all good to start trading as a business.
The registration process for a sole trader or partner is pretty simple however, it comes with very limited legal protection. A sole trader or partnership business is legally attached to you personally. As a result, you’ll be completely liable for the entire business which is a pretty big risk.
If your business is a serious endeavour, then we recommend registering it as a company. The process is more complex and time consuming compared to the other business structures however, there will be more legal separation between you and your company. This is because a company is a legal entity on its own – this better protects your liabilities as your business is able to exist by itself.
To register a company, it’s best to get the help of a legal expert. Company registration involves following the rules and regulations of the Australian Securities and Investments Commission (ASIC). Moreover, if you run a company, you’ll have ongoing obligations with ASIC. It’s best to get a legal expert to guide you through the process so they can equip you with the right knowledge.
Consumer Laws
No matter what type of business you’re running, it’s imperative that you’re well versed in consumer law. The Australian Consumer Law (ACL) doesn’t just protect consumers, it protects businesses too. In order to make sure your business is being legally compliant, avoids trouble and keeps its customers or clients happy, then you’ll need to abide by the ACL at all times. The ACL sets the standard for a lot of different matters including:
- Product quality and standards
- Refunds, returns and exchanges
- Misleading or deceptive conduct
- False advertising
- Pricing
Getting a legal consultation on the ACL is highly recommended. A legal expert can walk you through ACL requirements and ensure your business practices are aligned with them. Remember, not complying with the ACL can lead to penalties such as heavy fines, plus your businesses reputation could take a severe hit. It’s better to avoid this scenario and make sure your business is compliant with the ACL at all times.
Employer Obligations
When you start building your business’s team by hiring employees, you naturally attain the added responsibility of being someone’s employer. As an employer, it’s imperative that you’re on top of all your employer obligations. The Fair Work Act sets out most of the minimum standards for employees in Australia. As an employer, it’s important to consider matters like:
- Minimum wage, awards and entitlements
- Sick leave, maternity/paternity leave, domestic violence leave…etc
- Record keeping
- Work hours and breaks
- Flexibility options in the workplace
When you’ve got employees, it’s important to be on the same page as them. Having the right legal documents can be the first step in ensuring there’s clear communication between you and your team. Consider getting professionally drafted Employment Agreements, so employees know exactly what to expect when they work for your business. It’s important to get this done by a legal expert in employment law, so they can ensure that your employment agreements are perfectly in line with Australian employment regulations.
Note: The Fair Work Act recently went through some pretty major changes, known as the ‘closing loopholes’ amendments. The bill was split into two parts, you can read about part one of the bill here and part two here.
Data and Privacy Laws
Data and privacy laws are not only a legal obligation for businesses however, being aware of data and privacy issues can help protect your business down the road.
If your business has a website that collects any kind of personal information or it has an annual turnover of more than $3 million, then it falls under the Privacy Act. As such, you’ll need to have a Privacy Policy visible on your website.
If there happens to be a data breach, then it’s important to have a Data Breach Response Plan in place. According to privacy laws, you may have to notify certain parties in case of a breach and let them know they’ve been impacted. Having a written plan down can help make your response much more efficient and ensure nothing gets missed.
Even if you’re not legally required to have these legal instruments in place, it’s still a good idea to consider getting them anyway. Making sure your business is transparent and prepared never hurts – you can chat with our data and privacy experts for more information.
How Do I Comply With Business Regulations?
To comply with business regulations, you need to understand exactly which regulations impact your business, then utilise the correct legal instruments to help you achieve this objective.
As multiple different laws will affect your business, there are various different legal solutions you will likely need to implement. For instance, in some cases you may need a legal agreement whereas in others, you simply need a legal expert to guide you through a certain process.
The best way to move ahead is to chat with a legal expert. Your business, its goals and operations are unique. Therefore, your business deserves legal solutions catered to its betterment rather than something general (or no solution at all).
Next Steps
It’s always a wise idea to enlist the help of a legal expert when it comes to complying with business regulations. To summarise what we’ve discussed:
- Understanding and complying with business regulations is crucial for all businesses to avoid legal troubles and ensure fair practice
- Business regulations cover a broad spectrum including how customers and clients are treated, product and service quality, data handling, employee rights, and the specifics of business registration and operations
- The type and impact of regulations can vary depending on the business’s size, location, and industry, making it important for business owners to seek tailored legal advice
- Key legal requirements for businesses include registering the business appropriately, understanding consumer laws like the Australian Consumer Law (ACL) for customer interactions and product standards as well as complying with employer obligations under laws like the Fair Work Act
- Data and privacy laws require businesses to handle personal information responsibly, with specific actions required in the event of data breaches
- Consulting with legal experts is advised to ensure that the business meets all applicable regulations and to prepare for any changes in the law
If you would like a consultation on complying with business regulations, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
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