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Business news, business advice and information for Australian SMEs | SmartCompany

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    Do you sell gift cards, vouchers or certificates on your website or through your business? You might be surprised to know that if you don’t meet the Australian Securities and Investments Commission (ASIC) exemptions, you might need a financial services licence to do so.

     Gift certificates have become an increasingly popular product for Australian consumers. But many businesses offering them do not realise that gift cards, vouchers and certificates (all ‘gift certificates’) are generally considered ‘non-cash payment facilities’ and are regulated by ASIC. For example, if you provide a means for a customer to make a payment for goods or services using payments other than Australian or foreign currency, this would be caught by the legislation and you would have to have a licence.

    Many businesses seem to offer gift certificates, so how do you avoid triggering licensing requirements?

    Due to concerns regarding the number of insolvencies of small businesses and increased consumer complaints around sales practices for gift certificates, the consumer and financial services laws now dictate very specific exemption requirements for the sale of gift certificates to avoid the licensing requirements.

     You can meet the exemption requirements for gift certificates if you follow these guidelines:

    1. Gift certificates cannot be ‘reloaded’

    This means you cannot offer gift certificates which enable customers to add value or increase the value of their certificate amount otherwise it may trigger credit facility law, which requires credit licensing.

    2. Gift certificates cannot be redeemed for cash

     This means you cannot offer certificates which permit customers to use the gift certificate to purchase goods and receive the remaining balance in a cash payment.

     3. Consumers must be made aware of any ‘critical terms’

     The customer purchasing the gift certificate is not often the customer using the gift certificate, so both persons must be made aware of important terms of use. This includes things such as expiry dates, restrictions on items that can be purchased with the certificate, and all other limitations.

     4. Set a ‘reasonable’ expiry date

     Any expiry of less than 12 months may not be seen as reasonable in some cases.

     5. Marketed as a ‘gift’ product for multiple use

     Providing gift certificates as a means of payment for goods is essentially providing a ‘non cash’ payment facility. This means businesses must market them as ‘gift’ products and not, for example, as a cash ‘alternative’. The certificate must also permit more than one purchase or permit multiple uses until the monetary amount is used or the expiry date met.

     Gift certificates are a great way to attract new customers and increase brand awareness for your business, as well as a method to improve your sales. Don’t pass up the opportunity for your business – the market for gift certificates is growing.

    This article first appeared on StartupSmart.

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    Rudy Noel Frugtniet, a former director of Unique Mortgage Services Pty Ltd and Victorian finance broker operating under, has been banned by ASIC from engaging in credit activities.

    It was found he’d provided misleading information and a lack of full disclosure on an application for a credit licence.

    His lack of disclosure and misleading answers were given in relation to questions for the business’ application for a credit licence, and he had been the former person responsible for the licence for his practice, which is based in Melbourne.

    He also had an adverse disciplinary history, including involvement in the breach of the company’s travel agent’s licence.

    He’s also made a false declaration to the Migration Agents Registration Authority, had two rejected applications to be admitted as a solicitor, made a false statement on Newstart allowance application forms, misrepresented himself as a lawyer with standing to appear in court, had his conveyancing licence cancelled and made a false or misleading declaration to the Tax Practitioners Board.

    ASIC decided that his conduct was incompatible with the qualities required of someone allowed to engage in credit activities – that is, good character, honesty, integrity and judgement.

    Deputy chairman for ASIC, Peter Kell, said that they would remove quickly to remove people like this from the industry.

    “Those who deliberately provide misleading information in their credit applications simply should not be in the industry,” he said.

    Frugtniet has the right to appeal.

    This article first appeared on Property Observer.

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    The Australian Competition and Consumer Commission has raised concerns over supermarket giant Coles’ proposed bid to buy four Progressive Supa IGA stores in Western Australia.

    While Coles has recently been under scrutiny over allegations it has used its market power to bully suppliers, the company is looking to further expand its market share in the west with the acquisition.

    The stores, which are located in the Perth suburb of Dianella and the regional towns of Busselton, Halls Head and Bunbury, are not located close to any other Supa IGA stores in at least three of the four local markets.

    While the supermarket duopoly is widely recognised across Australia, the Western Australian market also has to deal with the absence of players such as Aldi, Foodworks and 7-Eleven.

    The ACCC said in a statement its preliminary view is that the proposed acquisition may result in a substantial lessening of competition.

    ACCC Commissioner Dr Jill Walker said market participants had expressed concerns about losing the differentiated offering of their local Progressive Supa IGA stores.

    “The ACCC considers that the differentiated offer of the Supa IGA stores reflects a competitive response to rival supermarkets and provides additional choice to consumers,” said Walker.

    “The ACCC is also concerned that the proposed acquisition would remove access to Supa IGA promotions for shoppers in these areas.”

    According to the ACCC’s issues paper, the newly acquired stores would be within a few hundred meters of existing Coles stores. 

    A Coles spokesperson told SmartCompany the supermarket major is considering the issues raised by the ACCC.

    John Cummings, president of the WA Independent Grocers Association, told SmartCompany that while the grocery market in WA is still one third Coles, one third Woolworths and one third independents, 30 years ago independent grocers enjoyed a 54% market share.

    “What’s happened is over a period of time Coles and Woolworths have acquired independent stores and increased their market share,” says Cummings.

    “I think only two stores have gone broke, the rest were bought by Coles and Woolworths.”

    Cummings says the WA Independent Grocers Association has long been opposed to these “creeping acquisitions” which eliminate competitive power from the independents left standing.

    According to Cummings, if the Busselton acquisition goes ahead, there will be two Coles stores within about 200m of each other, while there would be a difference of about 500m between the two Coles stores in Bunbury.

    In Dianella, Cummings says there will be around 15 Coles and Woolworths supermarkets within a 3-5km radius.

    “I mean, there’s got to be huge competition issues,” says Cummings.

    Cummings also says small WA suppliers will be affected by the acquisition, as their deals with IGA stores are terminated.

    “A lot of local suppliers will be put off the shelf. You have to be a national supplier to be stocked at Woolworths or Coles,” he says.

    Cummings says while Coles will likely pay more than the going market rate to secure the IGAs, due to its market power, it is in a position to potentially lose money on the stores – a luxury which an independent grocer doesn’t have.

    “That’s why we have the ACCC to maintain competition laws,” says Cummings. “The ACCC are saying [to Coles], this isn’t going to be as easy as you thought it was.”

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    Apple has won the right to trademark its flagship store design in Europe in a landmark ruling.

    The European Court of Justice last week ruled Apple stores are distinctive enough to warrant being considered for a trademark.

    German courts had rejected an application for a trademark from Apple, but referred the issue to European courts for guidance after the tech giant appealed.

    The store design in question is Apple’s parallel lines of big tables with electronic gadgets spread out on them under a high ceiling.

    The ECJ said a design pattern like Apple's "may constitute a trademark provided that it is capable of distinguishing the goods or services of one undertaking" from others.

    Apple successfully registered its store layout as a trademark in the United States in 2010.

    But Susan Walsh, senior associate at law firm Swaab Attorneys, told SmartCompany the American and European rulings may not immediately translate to Australia’s trademark regime.

    “The definition of what constitutes a trademark under the relevant European directive is a little bit different to our definition here,” she says.

    “It includes design and shape of goods and of their packaging, so in its decision the court focused on the store layout of the design and also considered it was packaging for the retail services that would be delivered in an Apple store. “

    Walsh says in Australia a trademark is a sign, but the definition of sign does not include design, and when it refers to packaging it refers to aspects of packaging. 

    “If you were to look at trademarking a store layout in Australia you would have to establish your layout constituted a shape or fell under the definition of a sign,” she says.

    “The other hurdle to overcome is to demonstrate that it is a sign that is capable of distinguishing your goods and services from those of another undertaking.”  Walsh says Apple has designated Australia as one of the countries in its international trademark application made in Madrid but the tech giant let the application lapse and never pursued it in Australia.

    She says while there are not any store layouts registered as trademarks in Australia the concept of a trademark continues to evolve. 

    “Eagle Boys Pizza has registered the pink glow associated with its neon signage,” she says.

    “That’s part of a move towards registering more of those marks that encompass the brand’s look and feel.”

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    An Adelaide paper mill worker has faced the Adelaide Magistrate’s Court after he was found to have been playing competitive basketball while claiming WorkCover benefits.

    Sokha Khat was convicted on three counts of making a false or misleading statement to WorkCover, receiving a suspended three-month jail sentence and fines of more than $3000.

    While some states have recently reduced WorkCover premiums, South Australia has one of the most expensive workers' compensation schemes in Australia. Adelaide Now reports the conviction was part of a crackdown on compensation fraud by WorkCover South Australia to yield savings of $1 million.

    Khat had been claiming benefits after suffering bilateral carpal tunnel syndrome while working in a paper mill in suburban Adelaide in January 2012, according to Adelaide Now.

    He returned to work on restricted duties after receiving medical treatment and rehabilitation, but then told his WorkCover case manager he couldn’t complete these lighter duties because of his injury.

    An anonymous tip off to WorkCover revealed 30-year-old Khat was playing competitive basketball during this time.

    According to Adelaide Now, Magistrate Sue O’Connor said Khat’s behaviour was deceitful and appalling when sentencing him.

    In addition to the suspended jail sentence, Khat was ordered to pay investigation costs of $2000, prosecution costs of $800, court costs of $280 and Victims of Crime levies.

    TressCox Partner and workplace law expert Rachel Drew told SmartCompany all workers compensation systems make it very clear to applicants they must be absolutely honest with authorities about the nature of their injury. Any failure to do so is considered fraud.

    “In this case it was a suspended sentence, so no jail time, but it is still considered a serious criminal penalty,” says Drew.

    Drew says employers are encouraged to make fraud claims if they believe an offence has been committed.

    “All workers compensation systems have quite sophisticated fraud detection units,” she says.

    “Small business should be aware of their rights and understand they have a right to review the decisions WorkCover makes if they think an employee is being dishonest.”

    However, Drew points out there are differences between worker’s compensation fraud and an overstatement of the injury.

    She says while it is common for workers to overstate their injury, usually because they genuinely believe it is severe, it is uncommon for workers to deliberately commit the level of fraud seen in this case.

    “In terms of fraud, it is not particularity common because it is a criminal offence. They have processes of detecting anything that amounts to fraud.”

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    A small craft brewery based in Sydney has emerged victorious in a costly two-year trademark battle with multinational beer giant SABMiller.

    In a David-and-Goliath type battle, Wayward Brewing has this week won the right to trademark the name Wayward for beer in Australia, two years after SABMiller India first objected to the small business’ bid to register the name in the local beer market.

    Peter Philip, founder and head brewer at Wayward Brewing, told SmartCompany this morning he shelled out more than $25,000 over the two years in his battle to be able to trademark the Wayward name. Although the Australian Trade Marks Office has ordered SABMiller to pay costs to Philip, he says this will amount to just $2,500 at best.

    “In direct costs, it has amounted to $25,000, with my legal fees around $15,000,” says Philip. “That’s not to mention the hundreds and hundreds of hours I have spent researching for the case, and you can’t put a price on the sleepless nights.”

    More importantly, Philip was forced to essentially put his business on hold for the two years.

    “It really held us back,” he says. “While the objection does not formally stop you from doing business, we’ve only been producing under 50,000 litres of beer a year.”

    “We’ve been successful at a number of beer festivals and we sell to pubs, so we know people like the product. But we didn’t want to invest hundreds of thousands of dollars to build something we wouldn’t be allowed to use.”

    Philip first started brewing his beer more than two years ago, and says he put in considerable effort choosing a brand name and checking whether his chosen name was registered by someone else in Australia.

    “We thought we were doing the right thing and we went through quite an extensive process of finding a name,” says Philip.

    “The Wayward name was available here and in the US and Canada and it really resonated with what we wanted to do with the business. We wanted to be a bit different from others and the name reflects our brewing style.”

    Philip registered the name and it was accepted by the trademark office in 2012, but he says SABMiller India registered an objection to the name in February 2013.

    “We had done a lot of due diligence so we were surprised,” says Philip. “The frustrating thing is that when an objection is lodged, the business does not actually need to say why they are objecting. They have a period of six months to actually file their evidence that there is a breach of trademark.”

    Philip says SABMiller objected to the Wayward name on every possible grounds, arguing the name Wayward could be confused with the name of one of its beer brands, Haywards.

    For his part, Philip says he had never heard of the Haywards beer brand, and it appears the product is imported into Australia in small quantities.  And he says SABMiller does not have a trademark registered for Haywards in the Australian market.

    “If you compare our logo and branding, I don’t believe any person could be confused,” says Philip. “I just don’t think it’s possible.”

    Finlaysons intellectual property, media and technology partner John MacPhail agrees, telling SmartCompany this morning the word ‘wayward’ is commonly used in the English language and it has a distinct meaning. It is therefore unlikely to be confused with a surname such as Haywards.

    MacPhail says companies have the right to object to a trademark bid if it is exactly the same as their trademark, or if it is not the same, it is so close to it that it would cause confusion.

    However, the trade mark office will usually apply the rule of thumb that in the case of a single word trademark, if the word starts with a different letter, it is probably not too similar and will usually have a “different concept and feel”.

    For this reason, MacPhail says the decision in favour of Wayward Brewing is “not too controversial”. “Reading between the lines, you’ve got to conclude SABMiller India ran this case very light. They didn’t put all their resources into it.”

    “You would think a very large brand-driven multinational like this would have all its ducks in position if it was concerned about going into a market,” he says.

    As for Philip, he says he was “always pretty confident” he could triumph over his brewing counterpart, as long as he didn’t run out of money in the process.

    “The challenge was trying to do this and stay afloat and not lose our house,” he says. “I didn’t want to give up without a fight. I would have been really sad if we had of lost. It would have been all that money for nothing.”

    SmartCompany attempted to contact SABMiller and SABMiller India but did not receive a response prior to publication.

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    A Sydney businessman already facing legal action for allegedly underpaying staff is set to face additional legal action from the Fair Work Ombudsman, who is accusing him of underpaying an additional 22 staff a total of $1.8 million.

    The Fair Work Ombudsman initially commenced legal proceedings against businessman Kia Silverbrook in April, accusing him of underpaying 21 employees a total of $870,000.

    In addition to these original charges, Silverbrook is now facing court proceedings alleging he underpaid 22 employees more than $1.8 million.

    Companies connected to Silverbrook are now involved in five separate legal proceedings in the Federal Circuit Court in Sydney.

    The companies include three at which Silverbrook was in charge of the overall direction, management and supervision of operations.

    These include patent application firm Priority Matters (accused of underpaying 15 employees a total of $452,997), medical research business Geneasys (five employees owed $362,973) and solar research firm Superlattice (one employee owed $55,969).

    In addition, IT company MPowa, which Silverbrook manages and majority owns, is accused of underpaying 17 employees a total of $1.42 million. He was also a director of Worldwide Specialty Property Services, a company that collapsed in April, which is accused of underpaying five employees a total of $390,984.

    The underpaid staff include a number of white-collar professionals, including IT staff, engineers, clerical workers, an accountant and a marketer.

    One employee is allegedly owed $166,914, while two employees of companies associated with Silverbrook are allegedly owed more than $200,000.

    TressCox Lawyers partner Rachel Drew told SmartCompany the amounts involved were quite astounding, noting it’s unusual for underpayments to be so high.

    “It’s certainly a very large underpayment, and it’s the sort of thing that FWO is likely to pursue very vigorously,” Drew says.

    “It makes you wonder how he got to that level of underpayment, and one of the things Fair Work will look at is whether there was intentional underpayment.”

    Drew says directors in Silverbrook’s position could be personally liable, even if the underpayment was not intentional.

    Meanwhile, in her statement, Fair Work Ombudsman Natalie James says the claims relate to employees not being paid either their full wages or any wages at all between February and December last year.

    “Many of the employees continued to provide services based on expectations that cash flow problems would be solved and they would be paid,” said James.

    “They continued to work without being paid for many months - notwithstanding the impact on their own financial position and requests for payment.”

    SmartCompany attempted to contact Silverbrook, but no comment was available prior to publication.

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    The Federal Court has awarded an IT executive $130,000 in a landmark sexual harassment case experts say will have considerable implications for employers.

    Experts are warning employers to have appropriate policies in place to avoid being liable for sexual harassment and inappropriate workplace behaviour.

    On Tuesday, the Federal Court awarded Rebecca Richardson $130,000 for distress caused by sexual harassment at software firm Oracle’s Sydney office in 2008.

    Last year, a judge awarded Richardson just $18,000 in damages and ordered her to pay her own legal costs, which amounted to hundreds of thousands of dollars.

    But the court in Sydney overturned that ruling, awarding her more than seven times the original amount and ordering Oracle to foot Richardson's legal bills.

    The case involved the conduct of one of Oracle's Melbourne salesmen, Randol Tucker, with whom Richardson began working on a bid project in 2008.

    Richardson’s case was based on the allegation that, from the first time she met Tucker face to face in April 2008, she was subjected to a humiliating series of slurs and sexual advances, which resulted in a constant barrage of sexual harassment, according to the judgement.

    In her original claim, Richardson pointed to 11 significant incidents, including one occasion where Tucker asked her, "So, Rebecca, how do you think our marriage was? I bet the sex was hot."

    The court found the harassment was the direct cause for Richardson leaving her job at Oracle, which the original decision had not.

    M+K Lawyers partner Andrew Douglas told SmartCompany the case was a landmark decision that would have huge implications for employers.

    “It’s the first claim for general damages, so pain and suffering, that is in line with common law for sexual harassment,” said Douglas. “The flow on effect will be dramatic.”

    He said there will now be a marked shift in tariffs relating to sexual harassment cases.

    “Previously the lower level cases were around $12,000-$20,000 where there wasn’t significant physiological damage,” says Douglas. “We will see that jump very considerably.”

    Douglas said compensation claims for low- to mid-level cases may now rise to around $50,000-$60,000, while very serious claims that show harassment to have caused debilitating depression may skyrocket to more than $200,000.

    Douglas also says the decision will likely lead to a rise in adverse actions based on sexual harassment. Adverse actions require a reverse onus to be proved and are a cheaper legal action for a plaintiff to take, but more costly for employers.

    Douglas says employers need to make sure they educate employees about sexual harassment and have the correct processes in place to enforce against it.

    “That way you as an organisation will not be liable, only the individual who does it,” he says.

    Oracle was contacted by SmartCompany, but the company declined to comment.

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    The federal government has pushed ahead with its plans to give the competition watchdog powers to fine franchisees and franchisors that breach the soon-to-be-updated Franchising Code of Conduct.

    Small Business Minister Bruce Billson introduced the Competition and Consumer Amendment (Industry Code Penalties) Bill 2014 in the House of Representatives yesterday, seeking to allow the ACCC to issue infringement notices of up to $8500 to businesses that breach industry codes, or seek penalties of up to $51,000 from courts.

    Billson told SmartCompany this morning he expects the bill to pass parliament without any opposition.

    “It’s a reform I’ve certainly been calling for for years and we’ve received widespread support from the community and both sides of parliament,” says Billson.

    Peter Strong, executive director of the Council of Small Business of Australia, told SmartCompany the introduction of the legislation is a “great move”.

    “You can have all the rules under the sun, but they are not good if you don’t have sanctions,” Strong says.

    “It sends a message to those who are doing the wrong thing that they will be punished in the only way they understand – that’s money.”

    Billson says the enabling legislation is one part of a two-step process. The bill will give the ACCC the power to impose penalties for any business breaching a code of conduct, and the government will specifically apply the clauses as part of its revamp of the Franchising Code of Conduct.

    The Coalition announced the changes in early April, along with the introduction of a general duty on franchisors and franchisees to act in good faith during their dealings with each other.

    The changes followed the recommendations set out by the 2013 Wein Review, which are set to be codified in the update to the code, which has regulated the sector since 1998.

    Billson says the government is still on track to have the new code operational from January 1, 2015, and says he hopes to introduce the code around October.

    “We have done extensive consultations and are working closely with all stakeholders involved in the franchise economy,” says Billson, who says he has been pleased with the willingness of the community to get involved with the process.

     “We’re very happy with the code and we’ll be refining and polishing it with further consultations,” he says.

    Billson says he is currently working on ensuring the “most effective transition arrangements” will be in place for franchisees and franchisors moving to the new code so the process will be “simple and straightforward”.

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    A Melbourne man has been charged with defrauding 14 investors of more than $1 million over a three-year period.

    Barry John Patrick of Sunbury appeared in the Melbourne Magistrates’ Court last week on 15 fraud charges, with the Australian Securities and Investments Commission alleging he persuaded investors to refinance their home and self-managed super funds to fund his non-existent property developments.

    The charges come just days after ASIC Commission Greg Tanzer warned trustees of self-managed super funds about the legal implications of accepting advice from real estate agents when investing their funds in property.

    ASIC said in a statement Patrick has been charged with eight counts of obtaining property by deception, five counts of obtaining financial advantage by deception, one count of theft and one count of running a financial services business without an Australian financial services (AFS) licence.

    The charges relate to the three-year period between 2007 and 2010, in which ASIC alleges Patrick formed companies to purchase properties for development and consequently persuaded investors to refinance their homes or self-managed super funds, or take out additional loans or credit cards.

    “ASIC allege the funds raised by Mr Patrick were not used to develop the properties, instead, they were used to pay interest payments to past and existing investors and to meet repayments on loans as well as for personal use,” said the regulator.

    But this is not the first time Patrick has fallen on the wrong side of the law.

    In 2010, Patrick received a four-month suspended jail sentence and a five-year good behaviour bond after pleading guilty to one charge of carrying on a financial services business without holding an AFS license and three charges of managing a corporation while disqualified.

    According to ASIC, during August 2003 and December 2006, Patrick persuaded 40 investors to invest in three companies: E.K.B Properties, Sandgrove Specialised Securities and Cardinia Specialised Securities.

    During the time, E.K.B Properties raised approximately $4 million, Sandgrove Specialised Services raised approximately $1.5 million and Cardinia Specialised Services raised approximately $1 million.

    According to Money Management, ASIC alleged Patrick and his associate Karl Heinz Veljkovic were pushing investors to roll over their superannuation into self-managed funds and then invest those funds into the three companies.

    However, the companies, which were controlled and managed by Patrick and Veljkovic, were placed into liquidation by the Federal Court in 2007 following investigations by ASIC. As of December 2010, ASIC said none of the investors had been repaid.

    In 2007, both men consented to Federal Court orders banning them from carrying on a financial services business; parting with any funds that have come into their possession by issuing, selling or offering a financial product; and managing corporations for a period of 20 years.

    Graeme Colley, director of technical and professional standards at the SMSF Professionals’ Association of Australia, told SmartCompany these kinds of cases arise from time to time, and are the result of a “failure of the independence between initial advice given to individuals and where the money ends up”.

    Colley says cases like this don’t preclude investing your self-managed super fund in property, but says “the hotter it gets, the closer you are getting to the fire”.

    As a general rule, Colley says investors should only consider advice from advisers with AFS licenses. This way, if something goes wrong, the investor potentially has some recourse against the licensee and can use formal complaints arrangements.

    Colley says it is also important to do your own research and be as thorough as possible. “Make some investigations into who owns the business, the relationship between the adviser and the organisation, and if there are any other real investors,” says Colley.

    Patrick is next due to appear in court on September 16. He faces a maximum 10 years in jail for each of the deception and theft charges, and a maximum jail sentence of two years if found guilty of operating a financial services business without an AFS license.

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    Many small Australian businesses are struggling to decipher overly complicated employment awards, according to Fair Work Ombudsman Natalie James.

    James has spoken out about the complexity contained in Australia’s 122 modern awards, which are currently under review by the Fair Work Commission.

    Speaking to Fairfax, James said around one third of the calls received by the Ombudsman’s office are from employers, with most callers asking for help to understand wage rates under the awards.

    “In this country we don’t have one minimum rate of pay—we have hundreds depending on what classification you are at,” said James.

    James believes the Fair Work Commission’s current review is an opportunity to make the system less complex, and her office has a role to play in the review.

    “We don’t have a vested interest. We are not saying up or down—just please, make it clear,” she said.

    “The traditional parties will say, ‘It’s been settled for 20 years that this [clause] means dot, dot, dot’ but that is not visible to people viewing the documents,” said James.

    “You can’t expect people to know the history and jurisprudence to work out what to pay people.”

    James said some awards contain provisions that are at odds with baseline national employment standards, which means employers can be following the awards which apply to their workplace but are in breach of the law.

    M+K Lawyers director Andrew Douglas agrees with James, telling SmartCompany this morning changes to the awards system in Australia that allow both employers and employees to understand their obligations are “well overdue”.

    While Douglas says it’s true there are “some unscrupulous people” who want to avoid their obligations as employers, “the reality is most employers want to know what they need to pay and to do it properly”.

    But he says the modern awards system is “impenetrable”, and at times even difficult for lawyers to understand, let alone employers and employees.

    “One of the difficulties with awards is that it is an old boys club, run by the unions, pushed by the unions and the employer associations,” says Douglas. “And that leaves everyone else at a disadvantage.”

    Douglas says the language and terms used in awards have, in most cases, been hard fought for by unions over many years, and so any attempt to make changes is met with great resistance.

    “Not only are the concepts legacy but so is the wording,” he says.

    Douglas welcomes the involvement of the Ombudsman’s office, describing James’ “pro-people view” that all people should be able to understand the agreements, as “brilliant”.

    And he says this approach could lead to less employment disputes.

    “The terrible cases we’ve seen through the past few years, a large proportion of these people just didn’t get what their obligations were,” says Douglas.

    “They weren’t on a level playing field. And the terrible thing is, they find out two or three years later that they have to repay a lot of money.”

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    The former owners of one of Australia’s largest stone fruit farms launched legal proceedings yesterday against the forced sale of their business, Murrawee Farms, when it was in receivership last year. 

    Gaye and Tony Tripodi initiated proceedings in the Federal Court against National Australia Bank, Freshmax Farms, the Financial Services Ombudsman and receivers SellersMuldoonBenton.

    The Swan Hill farm has since been purchased by the wholesale company used by the family to distribute its fruits through Coles, Freshmax Farms, trading as Holman Fresh. 

    The Tripodis are seeking order for the sale of the property to be declared null and void along with costs.

    Murrawee Farms is a key supplier of stone fruits to Coles.

    The business had debts of around $7.5 million and a forecast turnover of $6 million to $8 million a year when NAB called in Murrawee Farms’ loan.

    This triggered the receivership and the Tripodi family lodged a complaint with the Financial Services Omubdsman challenging NAB’s decision to call in the loan.

    They allege Murrawee Farm was sold to Freshmax Farms ahead of a ruling by the Ombudsman.

    The Tripodis also claim they made an offer to buy the farm which they believe was higher than Freshmax Farms’ offer but it was rejected by the receivers.

    Activist group Unhappy Banking is assisting the Tripodi family with the legal proceeding. 

    Geoff Shannon of Unhappy Banking told SmartCompany the offer the Tripois made was “the best offer on the table”.

    “But then the bank turned up at their place and said ‘you’ve got an hour’ until the new owners take over.”

    Shannon says the case has “wide ranging implications” for every bank in Australia.

    “If we succeed we could halt all receivers selling assets,” he says.

    Shannon says Unhappy Banking is working with a lot of farmers at the moment and in particular with a lot of NAB customers.

    “The NAB says it is ‘derisking’ its commercial loan book. We see that it doesn’t want to be a business bank anymore and just wants to be a retail bank,” Shannon says.

    “They are just walking away from businesses.” 

    Shannon claims banks are pushing farmers to farm debt mediation which paves the way for the banks to appoint receivers.

    “It’s quite sad what we are seeing.”    

    A spokesperson for NAB disputed Unhappy Banking’s claims.

    "We have worked with the customers involved for a number of years to resolve this matter," she says.

    "We are committed to supporting good quality and sustainable agribusinesses and assess all lending on a case by case basis."

    The spokesperson says NAB is the largest business bank in Australia and lends more to business than any other bank.  

    The NAB is "100% committed" to supporting its business customers. 

    SmartCompany contacted the Tripodis, Freshmax Farms, SellersMuldoonBenton and the Financial Services Ombudsman but did not receive responses prior to publication. 

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    A small marketing company has won a lengthy legal battle against its much bigger counterparts over the right to use the word “Thredbo”.

    In the latest example of a small business David taking on a larger business Goliath over a trademark dispute, the Federal Court ruled this week Thredbonet Marketing has the right to use the word Thredbo in its name and operations, given it is the name of a skiing region in New South Wales.

    Thredbonet was up against Kosciuszko Thredbo, a larger company which holds the lease for accommodation in the Thredbo Village and Thredbo Resort areas, and handles bookings for accommodation in the area.

    Kosciuszko Thredbo objected to Thredbonet’s use of the word Thredbo as it said the name had come to mean “more than a place” and instead was a “complete branded entity” synonymous with their operations.

    The business alleged Thredbonet was engaging in “misleading or deceptive conduct by using the name to promote their business”, as Kosciuszko Thredbo was akin to Disneyland in the sense it occupied “a unique position of control over the resort”.

    Kosciuszko Thredbo also accused Thredbonet of breaching consumer law and trying to dupe customers to thinking the two companies were the same.

    The court first ruled in Thredbonet’s favour in mid-2013, but Kosciuszko Thredbo appealed the original judgment.

    The Federal Court sided with Thredbonet for a second time this week, finding the word “Thredbo” refers solely to the geographical region and Kosciuszko Thredbo was therefore not entitled to use the word exclusively.

    SmartCompany contacted Kosciuszko Thredbo and Thredbonet but did not receive a response from either company prior to publication.

    Finlaysons intellectual property, media and technology partner John MacPhail told SmartCompany the outcome of the case is “not very surprising”, given the word Thredbo is “the only way practically to refer to the very successful ski operations in the Kosciuszko national park”.

    “How else are businesses there to name their products or refer to their product offering?” says MacPhail.

    MacPhail says Kosciuszko Thredbo may have been on a stronger footing had the name Thredbo been trademarked when the skiing village was established in the 1950s, but too much time has now passed.

    “I don’t think there are any precedents in Australia for someone owning the name of a whole village,” says MacPhail.

    While MacPhail says the Mantra Hotel Group was able to use their trademark of the Circle on Cavill building in Queensland to prevent sub-letters of the building using the name in their promotion material in 2010, he says this case related to a single building as opposed to a village.

    MacPhail says he suspects Kosciuszko Thredbo may have been using the case as a means of going after other operators in the area who also use the Thredbo name, but they are now left with little option but to accept the court’s ruling.

    Hazan Hollander, the law firm representing Thredbonet and its owner Glenn Smith, told Fairfax the court’s ruling is an “emphatic win”.

    “The case is a good example of a large corporation failing to bully a smaller company with massive litigation,” said senior lawyer Yves Hazan. And MacPhail agrees.

    “It’s refreshing sometimes that [these cases] do not always end up going to the big guys,” he says.

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    The Fair Work Commission has found a worker who was accused of fraud and dishonesty in relation to a WorkCover claim was unfairly dismissed from the company he worked at for more than 20 years.

    Shaun Kinnane was dismissed from his position as a fitter at DP World Brisbane in June 2013, after it was alleged he provided false information to WorkCover and deceived the company for his personal gain. The company said Kinnane, who also operated his own car fabrication business from home, failed to follow ‘return to work’ restrictions outlined in a medical certificate after injuring his shoulder at work.

    But Fair Work sided with Kinnane, ruling the termination of his employment was “harsh, unjust and unreasonable” and found DP World attempted to “rewrite history”.

    Fair Work deputy president Asbury said DP World had “no grounds” for claims Kinnane acted dishonestly or fraudulently. Instead the commission said key members of the company, including general manager Mark Hulme and return to work coordinator Alanna Fitzpatrick “almost immediately came to the view that Mr Kinnane was being dishonest about the incident and embarked on a course of action to prove that this was the case”.

    “This view was formed on the flimsiest of evidence and without any reasonable foundation,” said Asbury, who also took issue with how the company attempted to compile evidence against Kinnane, including using surveillance, which was “not based on reasonable grounds”.

    M+K Lawyers partner Andrew Douglas told SmartCompany it is “very common for employers to feel frustrated by the WorkCover compensation process”, and in many cases, they will have hearsay information that suggests an employee is not being completely honest.

    “This impacts on their premium and they can be aggravated so they try to mount a case against the employee,” he says.

    But Douglas says in this case, it is clear the employer had “no reliable evidence”. If it had, there could have very well been basis for dismissal, he says.

    Douglas says the second issue which arises in this case is the issue of complying with return to work restrictions.

    He says it is not enough that an employee does not comply with restrictions on their return to work, there has to be a “genuine intent” not to comply for there to be evidence of serious misconduct.

    But Douglas says many return to work plans are ambiguous and it can be difficult to know which duties fall outside of the restrictions. In this particular case, there was also a discrepancy between the weight Kinnane’s GP said he could lift, and the amount included in the return to work plan from his employer.

    “Most employers don’t get on the front foot and get people properly assessed, with a task analysis,” says Douglas when it comes to return to work plans.

    “They are inclined to just accept the plan from the GP … But the GP’s role is to be an advocate for the worker and they have no knowledge of the workplace,” he says.

    Douglas says the average amount of time an employee has off work on WorkCover plans in Victoria is 43 days, but this could be reduced substantially if employers “aggressively managed” the process by completing appropriate task analysis in return to work plans.

    Not only would this help to lower premiums, there are also benefits in terms of productivity, says Douglas.

    SmartCompany contacted DP World Brisbane but did not receive a response prior to publication.

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    Does your business have a refund policy? Do you know if you have to provide one? Can customers get a refund if they ‘change their minds’?

    You cannot say ‘No Refunds’

    A business cannot have a ‘No Refund’ policy. It’s against the law to say you will not provide a refund under any circumstances. This includes sales, gift items and even secondhand goods.

    On the other hand, consumers can ask a business for a refund or replacement but are not always entitled to one. If a consumer has, for example, changed their mind or found the item elsewhere at a cheaper price, they are not ‘entitled’ to a refund. This is at the discretion of the business.

    Your business does not have to provide a refund for a customer who changes their mind, orders the wrong item, wants to see or try on the item and decides they don’t like it. But there are certain circumstances where you are required to provide a refund.

    Five things your refund policy MUST include

    There are the minimum refund requirements dictated by Australian Consumer law. As a business owner, you must, at minimum:

    1. Refund or replace any defective, damaged goods or services. You may only be required to offer a partial refund if the customer has contributed to the defect. 
    2. Repair any minor defect. You can, at your discretion replace it or provide a refund if you are unable or unwilling to repair it.
    3. Replace or provide a refund on major defects at the customer’s option. You cannot decide this, it’s up to the customer. 
    4. Pay for postage and handling of the item if the cost of the return is significant. 
    5. Offer a refund on defective, damaged, faulty goods and services, including ones which are unsafe or ‘unfit for the purpose’ for which they were sold. You cannot say you offer NO REFUNDS under all circumstances and there is no time limit for customers to request any refund.

     This includes all gifts, sale and secondhand items. You cannot carve out minimum refund requirements for certain items your business is selling.

     These minimum requirements are not the only things you should consider when deciding your refund policy.

     Five important things you should do before finalising your refund policy

     When you are working out your refund policy you need to consider the commercial side of your business. If you are selling clothes or shoes, for example, customers will want to try things on. Your refund policy is a powerful marketing tool for your business and you need to ensure you are competitive in all aspects of your business.

    In determining your refund and exchange policy for your business, it’s important to do your research:

    1. Rethink your refund or exchange policy for ‘change of mind’: If you have a strict refund policy where they cannot return or exchange goods, you may have difficulty selling anything. Most successful e-commerce websites offer good return and refund policies, particularly for clothing, shoes and other items that need to be tried for sizes, colours, and fit.

    2. Consider your shipping and handling fees: If you have a refund or exchange policy that requires customers to pay for shipping and handling of exchange or refund, this may also deter potential sales. Consider including postage and factoring this into your prices for all sales.

    3. Check refund and exchange policies of other similar competitors: Ensure you are matching the market competition and purchaser demand as often the refund policy is a key factor in a customer’s purchase.

    4. Offer to pay for return of faulty or damaged goods: If you have faulty or damaged items, consider whether you want to pay for their return at your cost.

    5. Make the process simple: Consider making all refunds and returns as simple and painless as possible. It should be both easy on customers and a simple process for your business to save everyone time and money.

    Online sales of goods and services have a lot of competition these days. You have to know both the requirements for refunds as well as what your business should be doing.

    This article originally appeared on StartupSmart.

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    Buying a property is one of the most important financial decisions you will ever make. It's easy to get swept up in emotions when you think you've found "the one", especially when you're a first home buyer or you've been searching for ages. But it's very important to carefully consider the legal and financial implications before you sign a contract. Thorough research could save you a fortune and ensure you avoid a serious mistake.

    From the hundreds of real estate contracts I've read during my career, below are my top five legal tips to keep in mind when you're considering a purchase:

    1. Carefully inspect the property and check the condition of EVERYTHING before you sign the contract. A standard clause in the contract makes the vendor (or seller) only responsible for delivering the property to you at settlement in the condition it was on the day of sale, fair wear and tear excepted. So if the central heating wasn't working on the day you signed the contract, bad luck. Turning on all appliances and checking all light fittings beforehand will give you an accurate picture of the state of the property; you may be able to negotiate on price if something like an oven or garage door isn't working.
    2. Understand the zoning of the land and how it may affect your use of the property. Beware of flood paths or special building overlays, especially if there is a basement car park involved. It is prudent not to purchase a lower basement level car park in a flood zone (keep in mind that some apartments are sold with particular car parks allocated). The zoning of the land can prevent commercial or business activities being conducted. If you'd like to run a business from home, whether it's a professional service, childcare, wholesaling or anything else, always check if the planning scheme will allow it. You may require a permit or your proposed use may even be prohibited. Check with the local council if you're in any doubt.
    3. Beware of water easements. It is illegal to build on top of water drains and sewerage pipes without the permission of the water company. Look carefully at the water easement plan in the contract. You will not be allowed to build anything, even a deck, on top of a water easement and even if permission is granted, the water company can destroy any structure if they need access - and you are solely responsible for the cost. Look out for garages, carports and decks on the property: could they be built over water easements? If so, has permission been given? If not, the Council and water company could come knocking in the future and you'll be responsible, not the previous owner, unless you negotiate the wording of the contract.
    4. Don't be seduced by display units and rent guarantees. Spacious and well-lit display units are not a representation of your finished off-the-plan apartment. The fine print of the contract will make it very clear that you cannot rely on what you see in a display unit. Rather, carefully check the plans for your chosen apartment that are included in the contract. Use a tape measure to actually measure out the size of the apartment. How does it compare to your current home? What is the orientation of the apartment? Will it have enough natural light? North-facing properties are always preferable. And as for rent guarantees: these often aren't worth the paper they're written on. These guarantees are often provided by companies that are financially worthless or are wound up and closed by the time any purchaser may want to enforce a guarantee. Instead, do your homework about the rental market in the area. What rent could you achieve if all or most of the apartments in the building were all released onto the rental market at the same time? Always budget for conservative rent receipts.
    5. Don't rush, get advice and read the fine print. Resist any pressure from the real estate agent to quickly sign the contract. NEVER sign on the spot without getting advice – if possible, legal advice but at the very least advice from someone experienced in the property market. Remember that real estate agents are looking out for the vendor's best interests, not yours. If it's a private sale, take the contract home and 'sleep on it'. If there's an upcoming auction, request the contract at least a week in advance, to give you enough time to properly consider everything. Speak to your accountant and lender: can you afford it? Are there tax implications? READ THE FINE PRINT and never assume that it's straight-forward. One hour of your life spent checking or consulting with a lawyer may save you an enormous amount of grief and money. Remember, buying a property is a life-changing decision.

    Note: the above is general information and should not be considered as legal advice.

    Do you have a particularly general legal issue you'd like Kate to explore? Let us know.

    This article originally appeared on Women’s Agenda.

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    The head of the Association for Data-driven Marketing and Advertising (ADMA), Jodie Sangster, has clarified her position on mandatory reporting of data breaches, telling SmartCompany it is a company’s responsibility to report a breach only if it puts consumers at risk.

    Sangster’s comments come as mandatory reporting is again put in the spotlight after Catch of the Day last week reported a data breach three years after it took place.

    Mumbrella recently reported Sangster had warned against mandatory reporting, as it may see consumers unnecessarily “flooded” with reports that their personal details may have been compromised.

    “On the question of whether or not ADMA supports mandatory reporting, the position we take is, if it’s going to be mandatory, we need to set a sensible benchmark,” says Sangster.

    “If you set the threshold too low, consumers may be unnecessarily alarmed if they are not at risk.”

    Sangster says if there are any circumstances in the data breach that present a risk to consumer’s security, then it is “best practice” for a company to report the breach to those affected.

    But she says if the breach does not put consumers at risk, then it is not necessary to report it.

    Even accidently ‘cc-ing’ email addresses in an email – rather than ‘bcc-ing’ them – is considered a data breach, according to Sangster. She says reporting such small data breaches would dilute the meaning of the warning in the event of a serious data breach.

    Sangster says there is no need for business to add extra red tape in reporting all data breaches, but companies should be aware they have a responsibility to protect data and should abide by this best practice.

    While the best practice is currently in ADMA’s code of conduct, legislation against data breach reporting has failed to pass the federal parliament several times.

    Sangster says this is because the Privacy Commission’s guidelines are currently working.

    “Let’s introduce legislation when we do have problem,” she says.

    “Are there daily data breaches happening? Probably not. Are there incidences where companies need to tighten security? Absolutely.”

    In regard to Catch of the Day’s recent move to report a breach three years after the fact, Sangster says she is not aware of the reason the company would only now decide it should tell its customers.

    “Catch of the Day has said there was no risk to consumers. I’m not sure why they waited three years, there must be a reason, but I don’t know what that reason is,” she says.


    Image credit: Flickr/altemark

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    The Australian Human Rights Commission is calling for an overhaul of the Sex Discrimination Act, on the back of research that shows discrimination of pregnant women and new parents is a “widespread and systemic” problem in Australia.

    Despite discrimination on the grounds of pregnancy being illegal, a report from the commission found 49% of mothers report having experienced discrimination at some point during pregnancy, parental leave or upon return to work.

    Sex Discrimination Commissioner Elizabeth Broderick has called for the government to legislate to force employers to “reasonably accommodate a request for flexible working arrangements”.

    While legislation currently gives workers with families the right to ask for flexible arrangements, employers do not necessarily have to grant a request.

    The national Supporting Working Parents review, which was initiated in 2013 under the former Labor Government, has found startling cases of mistreatment of pregnant women, including a case of a woman being asked by her supervisor if she had considered having an abortion and another case of a woman miscarrying her child after being forced to scrub floors against doctor’s orders.

    One woman told the commission she was told she was “both a bad mother and a bad employee for working while having a young family”, while another said she was called “placenta brain” by one of her colleagues when she was pregnant.

    But it’s not just new mothers who have experienced discrimination at work, with 27% of fathers and partners also reporting having experienced discrimination when requesting or taking parental leave, or when returning to work.

    The report found discrimination against new parents can take many forms, including negative comments from co-workers and employers, being made to perform work duties while physically ill with morning sickness, and the withdrawal of job offers by employers when they are made aware of a pregnancy.

    Other parents reported being shut out of meetings and important workplace decisions if they were due to commence parental leave, or being told they were no longer suitable for their role, and its corresponding salary.

    The report found pregnancy related discrimination is more prevalent in big businesses than SMEs and Peter Strong, executive director of the Council of Small Business of Australia, says this result “proves what we’ve always said: in small businesses, it’s about the people”.

    Strong told SmartCompany in “black and white” cases, it is clear that discrimination against parents is wrong. However, he says there is a lack of attention paid to employers themselves who may be pregnant or raising a family.

    “What about the employers? If you think about it between 20,000 and 30,000 businesses in Australia ‘are pregnant’ at the moment. And if you include businesses run by couples, it’s probably more like 40,000 to 50,000 businesses that have a pregnancy within the business,” he says.

    Sandy Chong, owner of Suki Hairdressing Newcastle and chief executive of the Australian Hairdressing Council, told SmartCompany for small businesses, having staff go on parental leave is not so much an issue of discrimination, but an issue of the cost to the business.

    Chong employs many long-term staff in her 30-year-old hairdressing salon and currently has six mothers on her books. It means there has been times when multiple staff have been on maternity leave at the same time. At the moment, that means coordinating a complicated roster that takes into account flexible working arrangements for the group she calls her “mummies”.

    “There are costs for replacing someone [on maternity leave], costs to recruit and train new hairdressers … and you need to guarantee their positions back,” says Chong. “And they have to rebuild their clientele [when they return from leave].”

    While Chong says “it can be frustrating to look at the costs” and having multiple employees on maternity leave at the same time can be “a financial nightmare”, she says she learnt a long time ago that if her salon is flexible, her staff will stay longer.

    Diversity strategy and compliance consultant Prue Gilbert told SmartCompany the report “highlights to business that underpinning all their initiatives focused on retention, there needs to be education around pregnancy related discrimination”.

    While Gilbert says she does not often come across such “blatant” exmaples of discrimination in her work, she says the process of negotiating re-entry into the workplace for new parents can often make their decision to opt-out entirely easier.

    Gilbert says businesses, as well as parents, need to resist the “traditional stereotypes” of mothers being the best carers and fathers being the breadwinners. And this should start from the moment a pregnancy is announced.

    “It’s about creating an open and honest conversation right from the start,” says Gilbert, who says employers should be discussing a woman’s career within every conversation about her pregnancy.

    “It’s about collaborating to include all stakeholders and understanding their potential biases. Working flexibility is more likely to reduce the impact on the business and improve the productivity of the pregnant employee.”

    And Gilbert says if employers and employees work together to address the discrimination in the moment it takes place, it’s “less likely to evolve into a big issue”.

    Image credit: Flickr/tipstimesadmin

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    An obscure Malaysian company applied to trademark the term ‘MH17’ in Australia, less than one day after Malaysia Airlines flight MH17 was shot down over eastern Ukraine, killing 298 passengers and crew.

    The move comes after a Victoria-based insurance firm apologised late last week for purchasing ‘MH17’ on Google Adwords to promote its life insurance.

    A Kuala Lumpur-based company named Remit Now International applied to IP Australia to trademark "MH17" within the Class 41 services category, which covers entertainment services usage including films, online video games, plays and musicals.

    What Remit Now International actually does is unknown, with its website referring to an obscure function of "company formation and bank account set up”. It listed a residential address in Kuala Lumpur on its application, as well as a PO Box address in Southport, Queensland.

    Malaysia Airlines also applied to trademark the term, four days after the crash, but in categories Class 9 (scientific) and Class 16 (paper), as well as Class 41. It is thought the company tried to trademark the term to protect it being misused by other parties.

    Finlaysons intellectual property, media and technology partner John MacPhail told SmartCompany there will likely be a battle between Remit Now and Malaysia Airlines.

    “Very often you’ll have a skirmish and trademark fight to lock in rights,” says MacPhail.

    He says if the application does succeed, it would give Remit Now the ability to use the trademark on an entertainment service, not a product, such as an online game or app, or a motion picture.

    McPhail points out Remit Now actually filed for the trademark in the US the day before it filed for the trademark in Australia. But he says under international trademark law, once an application has been made for a trademark in one country, the applicant has an international priority to filing the term for the next six months, so there was no reason to file the next day in Australia.

    MacPhail says this suggests the company doesn’t really know what they are doing.

    “I’m not sure where this is going to get them. A lot of people have the misguided thinking that there is an opportunity to make money [trademarking a topical term], but there generally isn’t,” he says.

    People realise later on there’s no real value in [such trademarks].”

    SmartCompany attempted to contact Remit Now International, put did not receive a response prior to publication.

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    A Chinese restaurant in Sydney is considering legal action after a newspaper published a story which claimed it charged higher prices for non-Chinese customers. 

     Yin Li Sichuan Chinese Restaurant received racist abuse online and over the phone following the publication of an article in the Daily Telegraph which claimed it charged “10 per cent extra per dish” for English speakers. The news story also accused business owner Diana Xu of suggesting this was meant to be a secret among Asian customers.

     However speaking to Daily Mail Australia, Xu’s lawyer said her client denies telling the Daily Telegraph reporter there was a different price for Asian customers.

     “The difference between the prices is only for three items on the menu, and it is because of a printing error,” she said. “The Chinese menu had not been updated.”

     Xu told Daily Mail Australia all customers were treated the same and she was shocked and upset to read the article accusing her of discrimination.

     “We have been open for 13 years, we can promise everything is the same,” she told Daily Mail Australia. “All customers, if they come in my restaurant, are welcome.”

     Sally Scott, partner at Hall & Wilcox Lawyers, told SmartCompany newspapers enjoy a fair degree of legal protection in Australia in order to encourage the free-flow of information and freedom of the press.

     “Nevertheless, if a business is concerned about damage to its reputation due to a newspaper article, there are a number of possible actions that could at least be considered, including defamation, misleading conduct or injurious falsehood,” says Scott.

     But Scott says a company’s ability to sue for defamation is more restricted now than in the past.

     “Only companies with less than 10 employees that are not related to another company and not-for-profit companies that are not public companies can sue for defamation,” says Scott.

     “This will exclude many companies from taking action for defamation.”

     Scott says businesses also need to consider the reputational risks associated with taking action or sending a complaint.

     “This could extend the coverage of the issue and cause more damage,” she said.

     SmartCompany contacted Ren Zhou Lawyers for comment but did not receive a response prior to publication.

     Image credit: Flickr/transworld

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