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New report reveals Aussie SMB's legal health status: Flatline

Justin Grey
17 November 2015 3 minute readShare
My Business

Forty per cent of Australian small businesses do not have employment contracts and more than three-quarters don’t have adequate workplace policies in place, according to survey results released by cloud Legal services provider, LawPath.

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Forty per cent of Australian small businesses do not have employment contracts and more than three-quarters don’t have adequate workplace policies in place, according to survey results released by cloud Legal services provider, LawPath.

More than five hundred small businesses completed LawPath’s online Legal Health Check — a comprehensive questionnaire that helps business owners understand their level of compliance, whether they operate as a company, sole trader or partnership. Key results include:

  • 40% of businesses surveyed DO NOT have Employment Contracts, this includes Part-time, Full-time and Casual Employment Contracts. The biggest offenders are those operating Partnerships - 91% did not have employment contracts
  • 77.5% of businesses surveyed DO NOT have Workplace Policies in place, such as Drugs and Alcohol and Social Media Policies. Of those, the biggest offenders are Companies - 73% did not have workplace policies
  • 61% of businesses surveyed have hired contractors. Of those:
    • 17% DO NOT have Contractor Agreements (vs 40% for Employment Contracts)
    • Biggest industry users of Contractors are Information Media and Telecommunications (52%), Professional, Scientific and Technical Services (43%) and Retail trade (38%)
  • 63% of businesses surveyed conduct business online. Of those:
    • 22% did NOT have Website Terms and Conditions
    • 19% did NOT have a Privacy Policy

The Legal Health Check results were compiled from real businesses seeking genuine assessment of their legal compliance. The results are being released to raise awareness of the often simple but very important legal requirements placed on small businesses.

What these results mean for small businesses

Damien Andreasen, CEO of LawPath commented, “Small businesses are faced with numerous regulations and compliance requirements imposed by different levels of government, which is often costly and time consuming.” 

“In fact, it’s estimated that small businesses spend, on average, five hours a week complying with government regulatory requirements. The complexity has often meant that many small businesses are non-compliant.”  

“All too often we’ve found that it’s just a matter of small businesses simply not being aware of the legal requirements they need to adhere to which is why we created the Legal Health Check. Others avoid seeking legal advice entirely because of the cost and complexity associated with it. But the ramifications of not being compliant are just too big to ignore. It’s important that all businesses — big and small — review their legals to ensure they are compliant.”

Jess Arroyo, Founder of Weigh Less with Jess is a LawPath customer and used the Legal Health Check to ensure she had the right policies and practices in place to secure the business.

“Before I used LawPath I was using a random set of T&Cs and a privacy policy I found online. When I used the Legal Health Check I realised my business was genuinely at risk — I’m selling a health product so it’s critical I had quality terms in place. I now have watertight policies in place that I customised for free and then had reviewed by a lawyer through  LawPath.” 

Any business can take a free Legal Health Check on LawPath’s website - http://sem.lawpath.com.au/lhc/ 

About LawPath

LawPath is Australia’s leading provider of cloud Legal services for small to medium businesses, providing technology powered legal services at a fraction of the time, cost and complexity of the traditional system.

LawPath's cloud-based legal hub for small and medium businesses provides an easy legal workflow solution. Businesses can find and tailor legal documents which can then be sent to all parties to execute, before finally storing them in LawPath's easy-to-navigate cloud vault. LawPath’s Quick Quotes product also allows businesses to receive the best fixed-fee quotes from over 600 trusted Australian lawyers, often at more than 70 per cent cheaper than traditional services, at any stage of the legal process. 

Since launching in 2013, LawPath has helped over 13,000 customers save over $5 million in legal fees. 

About the Survey 

Information from this survey has been gathered from data entered through LawPath’s website - http://sem.lawpath.com.au/lhc/.  The Legal Health Check surveyed 518 businesses operating across Australia. Of the respondents, 62% operate as a company, 21% as sole traders, 9% as partnerships and 8% were undecided. The results were gathered from March 2015 - October 2015. For more details on the methodology behind the survey, please contact Sling & Stone (details below).


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New report reveals Aussie SMB's legal health status: Flatline
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Justin Grey

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