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The term ‘business day’ is something you might have come across multiple times. In fact, it’s a key term that can be found in important agreements and contracts.
What does a business day actually mean, though?
People might have different ideas on what a business day means to them, which is why it’s important to be familiar with the legal definition of it. This way, you know exactly what is meant by a business day when you come across the term in documents.
What Is The Meaning of Business Day?
The Acts Interpretation Act 1901 defines a business day by what it is not. Section 2b of the act states that a business day is any day that isn’t a:
- Saturday
- Sunday
- Public holiday
According to the definition, weekdays can only be considered a business day and never weekends.
If a public holiday falls on a weekday, then it will also not be considered a business day (for example, boxing day). Different regions will also have certain public holidays that may not apply to all of Australia, such as state specific public holidays. In this case, it’s best to check ahead to see if a particular day is going to be available.
Legal Definition Of Business Days Regarding Contracts
When it comes to contracts, having a time frame for the agreement or when a specific task needs to be carried out is essential. This is usually referred to as a ‘business day’. For example, you might decide that payment needs to be made within three business days.
In this case, it’s important for both parties to be aware of what is meant by a business day so everything can progress smoothly.
Keep in mind that you can opt to go for the statutory definition (and clarify this in your clause) or have your own definition of a business day. If you choose the latter, it’s important to be as clear and concise as possible so there is no chance of misleading people.
How Long Is A Business Day?
Another factor that should be taken into consideration is the length of a business day. Unlike the days of the week that are considered to be a business day, the statute does not define the hours that can constitute a business day.
Generally, most people are likely to consider business hours to mean ordinary working hours. That is, 9am to 5pm. However, working hours can differ for many people so it’s important to clarify any intended hours.
The case of Mohamed v Farah [2004] concluded that even if work is carried outside of ‘ordinary working hours’, it still counts as being part of that business day.
| Example You own a small business and hire a temporary assistant to sort through some files for you. The contract is for the duration of the task which should take no more than 10 business days with no specific hours. The assistant you hired conducts their work outside of ordinary working hours. However, this is fine and as their task is completed within the 24 hours of each working day – this is still considered to be legitimate. |
What Does This Mean For Contracts?
When drawing up a contract, it’s best not to leave any matters up for assumption. This means clarifying business days. If a task is required to be carried out within certain hours, then you will need to specify what your business hours are.
This way, all parties to the contract can be clear on their respective expectations and responsibilities, reducing the chance of any disputes arising.
Need A Lawyer To Review Your Contract?
Often, the tiny details that seem unimportant can make a big difference when it comes to legal agreements. A well-trained professional knows exactly what to look out for and what they need to pick up on so you don’t have to stress.
Have our trusted legal professionals review your contracts so you can rest assured they are working for you.
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