Man signing contract

Government takes next step to strengthen protections against unfair contract terms

Published: 16 December 2019

Late last week, the Morrison Coalition Government reaffirmed its commitment to protecting small businesses from unfair contract terms (UCT).

Following a review of the current protections earlier this year, to which the AMCA made a submission, the Government has announced the commencement of new round of public consultation on options to further enhance UCT protections.

Minister for Employment, Skills, Small and Family Business, Senator the Hon Michaelia Cash, said the consultation will explore options to strengthen the existing protections for small businesses from unfair terms in standard form contracts.

“Small businesses often lack the resources to identify unfair terms and to engage in negotiations over those terms. By strengthening the UCT protections, small businesses will get a fairer go,” Minister Cash said.
Assistant Treasurer, Michael Sukkar MP, said the consultation will seek feedback on a range of options, including making UCTs illegal, attaching penalties for breaches, and broadening the coverage of small business contracts.

“The changes have already improved protections for small business in some industry sectors, however, there is concern that UCTs are still being used in standard form contracts, highlighting the need for stronger deterrents to be built into the protections,” Minister Sukkar said.

“The consultation also seeks views on whether any enhanced protections for small business contracts should also be extended to consumer and insurance contracts, to ensure consistency in the operation of the protections.”

In recent weeks, the AMCA met with representatives of both Minister Cash and Assistant Treasurer Sukkar to implore them to ensure that changes the legislation would make protections more accessible to small businesses operating in building and construction industry.

Submissions will be open until 16 March 2020. 

The AMCA has begun preparing a submission and encourages all members to contact Policy Manager, Ben Hawkins, to raise issues or areas of concern.

For more information visit the Treasury website.