The Australian Competition and Consumer Commission (ACCC) issued a public warning notice because it has reasonable grounds to suspect that the conduct by Unfair Dismissals Direct may constitute a contravention of sections 18 and/or 29 of the Australian Consumer Law, and that consumers have suffered detriment and it is in the public interest to issue the notice.
It noted that Unfair Dismissals Direct did not offer legal services, but acted as a paid agent on a “no win, no fee” basis and deducted its fees from any final settlement for clients.
The watchdog noted that Unfair Dismissals Direct advertised its services online and offered potential clients a “free confidential assessment”.
Further, their contract with clients outlined fees which were to be deducted from any settlement paid into the companies’ accounts after successful conclusion of their claim.
However, from May 2018, the ACCC said it received complaints about Unfair Dismissals Direct, including from 18 consumers around Australia who complained that Unfair Dismissals Direct did not pay them their settlement monies, minus its fees, after their unfair dismissal claim was settled.
As a result, the ACCC said it had reasonable grounds to suspect that Unfair Dismissals Direct may have engaged in misleading and deceptive conduct, and made false or misleading representations, by telling consumers that it would receive settlement monies on their behalf, deduct its professional fee and transfer the remaining balance to the client when, in some instances, Unfair Dismissals Direct kept the remaining balance.
“We are very concerned that it appears some clients of Unfair Dismissals Direct, who were at a low point in their lives after losing their job, were not paid the settlement balance owing to them,” said ACCC commissioner Sarah Court.
“We are warning Australian consumers seeking representation for unfair dismissal claims to choose their representatives carefully.
“Consumers should do their research before signing any contract, including for unfair dismissal services. If a business is trying to pressure you into signing a contract quickly, without ample opportunity to review the contract, ask yourself why.”