From 12 November, 2016 the Australian Consumer Law will provide that a term of a small business contract is void if:
- the term is unfair; and
- the contract is a standard form contract.
The Recruiters Casebook has been exploring each of these key expressions as we prepare for the 12 November reform commencement date.
So far, we’ve looked at the definition of small business contract. A contract is a small business contract if it meets both a headcount requirement and an upfront price requirement.
We have already considered the headcount requirement (fewer than 20 employee) and the upfront price requirement (not more than $300,000 or $1 million if the duration of the contract is more than 12 months).
In our last article, we identified some recruitment, on-hire and contracting agency contracts that you might regularly use, which might be standard form contracts and took a closer look at how a court would decide if they actually are standard form contracts.
Standard form contracts that are often used by recruitment, on-hire and contacting agencies could be:
- terms of business under which you supply services to clients;
- terms of business under which you acquire goods, services or property interests (e.g. a commercial lease) from third parties;
- terms of business with your independent contractors – because they’re contracts for services;
- candidate or work seeker registration agreements – because you are supplying agency or representation services – even though the candidates or work seekers might not actually be engaged or might be between assignments.
In this article you will learn how to recognise terms of standard form contracts that might be unfair and how a court would decide if they actually were unfair. Continue reading