Companies are constantly trying to improve their cost effectiveness and efficiency. Arguably, how well they do these things will impact their overall success. That’s where Business Process Outsourcing (BPO) companies come into the picture. 

A BPO company gives business the chance to outsource certain business operations, so they can focus on managing other aspects of their business. A large quantity of businesses are utilising BPO, with this number increasing every year. 

If you’re not a business that utilises BPO, then you might think of becoming a company that provides a BPO service. 

With BPO demand rising, getting on board this train could be a worthy project. However, it’s important to do this the right way. When it comes to starting a BPO company, it’s crucial to take care of the legal considerations and protect your company from day one. 

Keep reading to learn more about starting a BPO company. 

What Do BPO Companies Do?

A BPO company is a third party service provider. Companies often outsource more routine or administrative tasks to another company for an efficient or cost effective way of getting it done. The provider of this service is known as a BPO. 

BPO’s offer a number of different services, ranging from: 

  • Customer Service 
  • Technical Support 
  • Human Resources 
  • IT Services 
  • Accounting 

If you’re thinking of starting your own BPO company, then it’s important to narrow down on the kind of services your BPO will offer. Conducting research, putting together ideas and then jotting  everything down in a business plan is a good way to create a blueprint for your BPO company. 

How To Start A BPO Company In Australia

To start a BPO company in Australia, you will need to register it with the main regulatory body for companies. The Australian Securities and Investments Commission (ASIC) is the primary regulator for all Australian companies. 

ASIC has some pretty strict rules and regulations, both for when you’re registering your company and once you’re running it. It’s important to be familiar with your obligations under ASIC. Get on top of matters such as audits, reporting changes and paying fees or you could face consequences for non compliance with their rules. Chatting with a legal expert can help you become more familiar with ASICs requirements. 

The process of registering your BPO company requires you to fill out an online application form with ASIC. The application will ask some basic administrative questions, as well as more complex questions regarding the legal structure of your company, its governance, directors and shareholders. 

It’s important to go into the application prepared with these details or else you might find yourself getting stuck! Navigating ASIC, figuring out matters such as company legal structure and governance can be a headache for anyone that isn’t familiar with it. It’s best to get a legal expert to help you out with this process. Your company registration will set your company up as a legal entity on its own. How well you do this step will significantly impact your BPO companies future, so it’s important to make sure you have an expert’s help

Are There Any Laws I Need To Follow When Starting A BPO Company? 

When running any kind of company, legal compliance is of utmost importance. Ensuring legal compliance helps your BPO company stay out of trouble – meaning no fines, legal consequences or a bad reputation. 

In order to do this, it’s necessary to know exactly what laws impact your BPO company and the best way to abide by them. Chatting with a legal expert will help you get a better idea of this, as the laws that will impact your BPO company are going to depend on your unique circumstances. 

For instance, there might be local council regulations or industry specific rules you will need to adhere to. A legal professional can help ensure your BPO company’s practices and operations are in line with the necessary laws. 

There are also general legal principles that apply to most companies. We’ve talked about them briefly below – keep reading to find out more. 

Australian Consumer Law (ACL) 

As a company, it’s important to follow ACL principles when interacting with clients. The ACL  cover matters regarding: 

  • Pricing
  • Misleading and deceptive conduct
  • False advertising
  • Product and service quality 
  • Industry codes of conduct 

The above list is just a small glimpse, there’s a lot more to the ACL! It’s important to be familiar with the ACLs standards and make sure your BPO company’s practices are in line with it. 

ACL principles are also there to protect small businesses as well. As a new BPO company, you are likely to benefit from rules regarding standard form contracts (we’ve written more about them here) and a few other matters, so make sure you get in touch with a legal expert and have a chat with them about the ACL. 

Employment Law

As a BPO company, you’ll likely be hiring staff to work on your team. When this happens, you’re required to fulfil your obligations as an employer. Your duties as an employer will vary based on your business practices. However, they involve everything from making sure your employees are being paid according to national minimum standards, to providing a safe working environment for them. 

Data And Privacy Law

When running a BPO company, you will naturally have access to data regarding your clients and even their clients. As such, data and privacy security practices are paramount in your line of work. Taking reasonable steps to safeguard the information your BPO company has is necessary if your company wants to remain legally compliant and maintain the trust of clients. 

Do I Need Any Legal Documents For My BPO Company?  

Some of the laws and regulations we discussed (see above) have legal documents that can help you stay compliant with them. 

For example, an Employment Agreement can clearly communicate an employee’s rights and responsibilities. A Data Breach Response Plan is a pre planned set of steps in case of a data breach, so your company can have a more efficient reaction. When following employment laws and data regulations, many companies opt to have these agreements in place. 

Other than legal compliance, legal documents also have the benefit of protecting your company. A Service Agreement will be the main contract you have with your clients, setting out the terms of your relationship, securing your revenue streams and limiting your liabilities. 

Talking to a legal expert can help you determine the right legal documents for your company. We’ve listed a few more common ones for you to consider here: 

Next Steps 

Properly registering your company, following the relevant regulations and getting the necessary legal documents are all important parts of successfully setting up your BPO company. To summarise what we’ve discussed: 

  • To start a BPO company in Australia, registration with the Australian Securities and Investments Commission (ASIC) is required, which involves understanding and complying with ASIC’s rules and regulations
  • Ensuring legal compliance is crucial, including adherence to Australian Consumer Law (ACL) and employment laws, to avoid fines, legal consequences, and maintain a good reputation 
  • Data and privacy laws are particularly important for BPO companies due to the nature of handling sensitive information, necessitating robust data security practices 
  • Essential legal documents for a BPO company include Employment Agreements, Data Breach Response Plans, Service Agreements, Privacy Policies, and Non-Disclosure Agreements
  • Consulting with legal experts is recommended to navigate registration, compliance and to draft necessary legal documents

If you would like a consultation on starting a BPO company, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.

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