If a customer gets injured after purchasing a product from you, then you may be wondering what your responsibilities are. As a business owner, it’s important to report any serious injuries to the relevant authority in a timely manner. 

However, it’s always best to take any precautions in your power to protect your business and consumers from any potential incidents. 

In case of this happening, understanding your rights and obligations as a supplier under Australian Consumer Law (ACL) is key. In this article, we’ll discuss:  

  • Your liability if a consumer is harmed 
  • Legal obligations and reporting in case of an incident
  • Liability waivers
  • Consumer guarantees, safety and harm 

What Is Consumer Protection Liability?

Consumer protection liability refers to the responsibility of suppliers and manufacturers to ensure the products they sell to customers are safe to use. 

Consumers have the right under the ACL to purchase a product that does not cause them harm in any way. As a result, the liability of injuring customers through faulty products extends to suppliers, too. 

What Should I Do If A Customer Injures Themselves?

If a customer injures themselves, they may be able to claim damages and compensation. Once you have become aware of an incident that resulted in a serious injury of a customer, it is your duty to report it to the Australian Competition and Consumer Commission (ACCC). 

It is the duty of all members of the supply chain, manufacturers, suppliers, sellers and anyone else in between to report the matter to the ACCC. Regardless of which category you fall into, it’s always best to make sure you notify the ACCC if you ever learn of an incident. 

Reporting to ACCC

The ACCC updated their guidelines on reporting customer injuries in December 2021. 

According to section 131(1) of the ACL, the supplier of goods must notify the ACCC when a serious injury, illness or death has occurred that is related to their product. The supplier must do this within two days of learning about the incident, otherwise they can be charged with fines.  

The new guidelines provide further information on customer injury reporting. 

What About My Liability?

If you’re selling goods, then it’s likely you’ve had little to no control over its manufacturing (unless you are selling something you have made yourself). 

If this is the case, then you may want to consider a waiver of liability for personal injury. A waiver for personal liability or injury can let consumers know that you are in no way responsible for how the product has been made. 

A waiver can play a significant role in protecting your business should a customer face serious harm from a product they have purchased. 

What Are My Other Obligations?

Business owners have a number of obligations to their customers. From the time they begin their interaction with your business, it’s important to take reasonable steps to ensure the experience is a safe and happy one.  

Safety  

If your business operates from a physical space, then it’s your responsibility to provide a safe environment for customers to visit. In light of COVID-19, it’s important to make sure that all precautions have been taken to keep it sanitised and warn customers of any potential hazards, such as a freshly mopped floor. 

Similarly, if your business operates from an online platform, then it needs to be safe to use. Visitors to your website should not be exposed to any data breaches, scams, online harassment or viruses from anything on your site. 

You can mitigate these risks through Website Terms & Conditions or a Data Breach Response Plan

Consumer Guarantees

According to the ACL, consumers have a right to certain guarantees. These automatically apply to all consumers in Australia. Consumer guarantees cover matters such as: 

  • Product quality 
  • Misrepresentation
  • Product accuracy to description 
  • Warranty 
  • Titles labelling the product 
  • Hidden charges
  • Spare parts 

If these guarantees are not met, consumers are entitled to remedies. There are, however,  exceptions to consumer guarantees. 

For example, any goods or services costing more than $100,000 that are normally used for business objectives fall under the exceptions. 

It should be noted that there are also exceptions to the exceptions, so if you are confused about where you may fall on the spectrum reading a particular matter, contact us for a chat!

Consumer Harm

As mentioned previously, consumers have the right to be kept out of harm’s way for any product or service they purchase. Therefore, reasonable care should always be taken in making sure that a product cannot do any damage to another living being. 

There are a number methods that can be implemented to avoid harm to consumers: 

  • Testing the product multiple times and various different ways with safety in mind
  • Adding care and user instructions to the product so it consumers know the best possible way to use it
  • Adding any potential hazard labels to the product 

If you are a business owner who does not make the items, these are just some of the factors to look out for that could influence what products to associate with your businesses. 

While liability may not necessarily fall entirely on you, it’s always safe to not have any complaints at all. 

Product Safety And Negligence 

Manufactures are directly liable for products that have harmed the consumer due to any negligence. In this case, consumers are able to claim compensation and damages. 

However, there are a number of defences available to manufacturers where they are able to limit their liability or completely avoid it. These instances include where: 

  • The defect reasonably could not have been detected by the manufacturer
  • The safety issue was not present when it was first purchased 
  • The safety issue existed in compliance with another commonwealth standard (in which case the government would be responsible) 
  • The default was caused by packaging or instructions  

If you are making the products your business sells (i.e. handmade candles), then it’s important to take the utmost care in ensuring anyone who handles it is safe. However, in case something does happen that was out of your control, there are instances where your liability can be waived. 

Example
Juan makes handmade wooden toys for children. After creating them, he always sands down the surface to ensure it’s smooth and hands all his customers a complimentary care kit with instructions. 

Recently, Juan has received a complaint about a product he made five years ago that caused a splinter on someone’s hand. As the fault did not exist at the time of purchase and appears to have resulted from lack of care of the product, Juan likely does not have any liability for the injury. 

As it does not qualify as a serious injury, Juan does not need to report it to the ACCC. 

Key Takeaways

Avoiding consumer harm is your responsibility as a business owner, but in case it does happen, there are a number of steps you can take. It’s important to remember the following:

  • It is your legal obligation to report news of a serious injury caused by a product within two days of finding out about it to the ACCC
  • Invest in liability waivers where possible
  • Ensure you are taking all reasonable precautions to provide your customers with not only safe to use products but also an environment that is free from harm  

If you would like a consultation regarding customer injuries, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.

About Sprintlaw

Sprintlaw is a new type of law firm that operates completely online and on a fixed-fee basis. We’re on a mission to make quality legal services faster, simpler and more affordable for small business owners and entrepreneurs.

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