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Small businesses given collective bargaining exemption

Adrian Flores
Adrian Flores
22 October 2020 1 minute readShare
Small businesses given collective bargaining exemption

Small businesses will be able to collectively negotiate with their suppliers and processors, franchisor or fuel wholesaler, respectively, without first having to seek ACCC approval under a new class exemption.

Businesses will be able to use the class exemption after the period for parliamentary disallowance expires in early 2021.

Covering more than 98 per cent of Australian businesses, the class exemption will apply to businesses and independent contractors who form, or are members of, a bargaining group, and who each had an aggregated turnover of less than $10 million in the financial year before the bargaining group was formed.

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In addition, all franchisees and fuel retailers governed by either the Franchising Code of Conduct or the Oil Code of Conduct will also be able to collectively negotiate with their franchisor, regardless of their aggregated turnover. 

Under the exemption, bargaining groups will only have to fill out a simple, one-page form and provide it to the ACCC.

 

After that, legal protection from competition laws will then commence automatically and there will be no fee for lodging the form.

This collective bargaining exemption is the first class exemption to be introduced by the ACCC.

ACCC commissioner Stephen Ridgeway said he hopes the class exemption will help a range of Australian small businesses and franchisees.

“The class exemption will also increase levels of awareness among small businesses about the potential benefits of collective bargaining which, along with the simpler process, may encourage more businesses to collectively bargain,” Mr Ridgeway said.

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“There can be many benefits for businesses negotiating as a group rather than individually, including sharing the time and cost of negotiating contracts, and potentially giving group members more of a say on contract terms and conditions.

“There are often also time and cost savings for the suppliers or franchisor the group is bargaining with. This change will mean the benefits for all parties can be gained through a much simpler and quicker process.”

Small businesses given collective bargaining exemption
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Adrian Flores
Adrian Flores

Adrian Flores is the deputy editor of MyBusiness. Before that, he was the deputy editor for SMSF Adviser as well as features editor for ifa (Independent Financial Adviser), InvestorDaily, Risk Adviser, Fintech Business and Adviser Innovation.

You can email Adrian at [email protected].

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