ACCC v Employsure

Employsure was a private company selling workplace relations and workplace health and safety services to employers and business owners. Its business was commercial. It offered advice, subscription-based services, document review, a 24 hour advice helpline and, in some cases, representation in courts and tribunals. The Court noted that it had no affiliation with, or endorsement by, any government agency.

The dispute arose from Employsure’s Google advertising strategy. During the period from 10 August 2016 to 31 August 2018, Employsure arranged for Google Ads to appear when users searched terms connected with official workplace bodies. The judgment identifies terms such as "fair work commission", "fair work Australia", "fair work", "fwc" and "fair work ombudsman". Employsure knew those terms were frequently used by consumers visiting the websites of the Fair Work Ombudsman and the Fair Work Commission, and it selected them as keywords.

That keyword strategy mattered because of how Google Ads worked. Paid search results could appear above organic results. Advertisers could optimise ad copy and landing pages, and could also use dynamic keyword insertion so that a keyword used by the searcher could automatically appear in the ad text. The Court explained that this meant the paid search advertisement could appear differently depending on the search terms used.

The judgment gives a concrete example. When a person searched for "fair work ombudsman", the first search result could display the headline "Fair Work Ombudsman Help - Free 24/7 Employer Advice". If the user clicked the ad, they were taken to an Employsure landing page. If they called a number shown in some ads, they reached an Employsure representative. None of the Google Ads mentioned Employsure.

The ACCC alleged that seven Google Ads conveyed that Employsure was, or was affiliated with and or endorsed by, a government agency. It said the impression came from the headlines, the wording, the URLs, the references to free advice, the use of the definite article in describing the advice service, and the search context itself. At first instance, the primary judge rejected that part of the ACCC’s case. The ACCC appealed in relation to six of the seven ads, and the Full Court had to decide whether the primary judge had been wrong to conclude that the ads did not convey the alleged government affiliation representations.

The central legal question was whether six Google Ads conveyed to the relevant audience that Employsure was, or was affiliated with and or endorsed by, a government agency. If they did, the Court then had to decide whether that amounted to misleading or deceptive conduct under s 18 of the ACL and false or misleading representations under ss 29(1)(b) and 29(1)(h).

The appeal was not about every part of the ACCC’s broader case at trial. The primary proceeding had included other claims, including claims about keyword design, a free advice helpline, unconscionable conduct and unfair contract terms. Those other claims were dismissed below, but they were not the subject of this appeal. The appeal was confined to the first claim and then only in relation to six of the seven Google Ads.

The Court also had to identify the right audience. The primary judge had found that the relevant class was not the public at large, but business owners who are employers and who search for employment-related advice on the internet. That finding was not challenged on appeal. So the Full Court assessed the ads through the eyes of an ordinary or reasonable member of that class.

An important part of the appeal concerned method. The primary judge had concluded that the ads did not convey the alleged representations. The ACCC argued that the primary judge had erred in the way he assessed the likely reactions of the audience, including by attributing characteristics to the audience that were too favourable to careful reading and by relying on a "not insignificant number" test. The catchwords show that the Full Court considered whether the primary judge erred in conceiving of only one reasonable reaction and whether he erred in finding the ads did not convey the alleged representations.

For business readers, this is significant because the case is not about a literal false statement alone. It is about overall impression in a real online setting. The Court looked at internal and external context, including the search terms used, the appearance of the ad as a paid result, the wording of the headline and URL, the prominence of official names, the omission of Employsure’s own name, and the fact that users could click or call quickly.

The Full Federal Court allowed the ACCC’s appeal. It held that the primary judge had erred and that, by publication of the Google Ads, Employsure conveyed the government affiliation representations to the ordinary or reasonable member of the relevant class. The Court said this constituted misleading or deceptive conduct, or conduct likely to mislead or deceive, in contravention of s 18, and the making of false and misleading representations in contravention of ss 29(1)(b) and 29(1)(h).

The statutory findings matter. Section 18 addresses misleading or deceptive conduct generally. Section 29(1)(b) concerns false or misleading representations that services are of a particular standard or quality. Section 29(1)(h) concerns false or misleading representations that a person has sponsorship, approval or affiliation. The Court’s catchwords and reasons make clear that the appeal succeeded on all three of those ACL bases in relation to the impugned ads on appeal.

The Court’s reasoning, as shown in the judgment, was grounded in the actual advertising mechanics and context. Employsure had selected search terms commonly used by consumers seeking major government agencies. Some of those terms then appeared in the ad headline. The ads appeared as the first search result. They offered free employer advice and, in some cases, a phone number that could be called immediately. None of the ads mentioned Employsure. In that setting, the Court concluded that the ordinary or reasonable business owner in the target class would take from the ads the misleading government affiliation message alleged by the ACCC.

The Court also rejected the first instance outcome procedurally. It set aside the orders made on 1 and 23 October 2020. It directed the parties to confer and seek to agree the form of any declaration and injunction that should be made, with short submissions to follow if agreement could not be reached. It remitted the proceeding to the primary judge for hearing on pecuniary penalty and costs in respect of the first instance proceeding. It also ordered Employsure to pay the ACCC’s costs of the appeal.

That procedural outcome is important. The appeal judgment did not itself finally fix the pecuniary penalty. Instead, it established liability, cleared the way for declarations and injunctions, and sent penalty back to the primary judge. So the key public takeaway from this decision is the liability finding and the remittal orders, not a final penalty amount in the appeal judgment itself.

The judgment is especially useful because it shows exactly what a court may examine in a paid search case. First, it looked at the keyword strategy. Employsure selected terms that it knew were frequently used by consumers visiting the websites of the Fair Work Ombudsman and the Fair Work Commission. That does not mean using a competitor or public body name as a keyword is always unlawful, but it does mean the choice of keyword is part of the context and can be highly significant.

Secondly, the Court examined the ad format and Google’s advertising features. The reasons explain the difference between organic results and paid results, how paid results can appear above organic results, and how dynamic keyword insertion can cause the searcher’s own terms to appear in the ad text. That matters because a business cannot assess legal risk by looking only at a static draft headline. It must consider how the ad may actually render in response to different searches.

Thirdly, the Court focused on prominence and omission. The ACCC’s case, summarised in the reasons, relied on the use of names such as Fair Work Ombudsman, Fair Work Australia and Fair Work Commission in the headline and URL, the official or authoritative air those words created, and the fact that Employsure did not appear in the ads. The Full Court ultimately accepted that the ads conveyed the government affiliation representations. For practical purposes, that means omission of your own identity can be just as important as the words you include.

Fourthly, the Court treated the search context as part of the message. The ads appeared after searches such as "fair work ombudsman", "fair work australia", "fair work commission", "Australia government fair work" and "Australia fair pay". The ACCC also relied on the fact that some ads displayed a phone number, allowing users to call immediately. In other words, the legal question was not confined to what a careful reader might conclude after extended reflection. It was about the impression created in the real conditions of online search, where users may click or call quickly.

Finally, the judgment shows that landing pages and call handling can still matter even where the appeal turned on the ads themselves. The reasons note that clicking the ad took users to an Employsure landing page and calling the number reached an Employsure representative. Businesses should therefore review the whole path from keyword to ad to landing page to first contact. If the first impression is misleading, later clarification may not save the campaign.

Businesses should read this case as a warning against campaigns that trade on confusion between a private service and an official body. The Court did not say that every user would necessarily be misled in every circumstance. But it did hold that the ordinary or reasonable member of the relevant class would take the misleading government affiliation message from these ads in context. That is enough to create serious ACL exposure.

The case is especially relevant where your service sits close to a public function. Employment advice is one example, but the same risk can arise in tax, migration, licensing, grants, complaints handling, planning, consumer redress, safety compliance and other regulated fields. If customers are likely to search for a government body first, your campaign needs to make the distinction between your private business and the official body immediate and unmistakable.

It is also a reminder that good intentions are not enough. The judgment records that Employsure was not deliberately trying to lure people away from government agencies. It was trying to reach prospective customers who were business owners with employment-related issues. Even so, the ads were found misleading. Under the ACL, liability turns on the impression conveyed, not only on subjective intention.

From a governance perspective, this means marketing teams should not treat search ads as low-risk because they are short, automated or platform-generated. Dynamic features can change the wording shown to users. Search context can change the meaning of otherwise ordinary words. And omission of the advertiser’s name can be decisive. Campaigns that target official names or official-sounding phrases should be escalated for legal or senior compliance review before launch.

Businesses should also be careful about relying on the idea that users know how Google works. The reasons show that the Court assessed the ads in the practical conditions in which they were encountered. Paid placement, quick clicks, clickable phone numbers and the prominence of the searched term all formed part of the context. If your campaign performs by catching users who think they have found the official channel, that is not a clever marketing result. It is a legal risk signal.

The appeal decision is Australian Competition and Consumer Commission v Employsure Pty Ltd [2021] FCAFC 142, decided by Rares, Murphy and Abraham JJ on 13 August 2021 in the Full Court of the Federal Court of Australia. It was an appeal from Australian Competition and Consumer Commission v Employsure Pty Ltd [2020] FCA 1409.

The relevant advertising period identified in the judgment ran from 10 August 2016 to 31 August 2018. The judgment also sets out more specific date ranges for individual ads. For example, one ad responding to the search term "fair work ombudsman" ran from 27 August 2016 to 12 April 2018, another from 31 August 2017 to 31 August 2018, and other ads responded to searches such as "fair work australia", "fair work commission", "australia government fair work" and "australia fair pay" during overlapping periods.

As at this appeal decision, the Court had finally determined liability on the appealed issues and made consequential procedural orders. It had not itself fixed the pecuniary penalty in the appeal reasons. Instead, it remitted penalty and first instance costs to the primary judge. That is why this page focuses on the appeal findings and orders actually made in 2021.

If you are using this case as a compliance guide, the safest reading is straightforward. Do not assume that a private business can safely advertise against official search terms if the ad leaves room for users to think they are dealing with the government. The closer your campaign gets to that impression, the more likely it is to attract regulator attention and court scrutiny.