Rights and Obligations of Small Businesses

When establishing a small business, there are many legal obligations that must be fulfilled. These obligations include things like registration requirements, fair trading practices, taxation obligations, and obligations to employees regarding workplace safety as well as employment conditions. A solicitor can help you develop a thorough understanding of what obligations you need to meet and can also provide sound advice on how to protect your business interests.

Licensing, Permit and Registration Requirements

When establishing a new business, one of the first things it is necessary to investigate are the licensing, permit and registration requirements. Because these requirements vary according to the structure of the business, the type of business that is being operated, the location of the business premises, whether the business has any employees and even the local council area, it is a good idea to seek legal assistance in determining how to meet you obligations.

One registration requirement common to every business operating in Australia relates to obtaining an Australian Business Number (ABN). The ABN identifies a business for purposes of taxation and for dealings with other government departments and agencies.

Except where a business is operating under the full name of its owner, it is also necessary to register the business name. In order to be registered, the business name cannot be the same as or be likely to be confused with a business name that has been previously registered in Queensland, nor can the name be identical to an Australian company name. Registration is necessary in order to be able to open bank accounts, purchase from wholesalers at wholesale prices, or even to be able to be listed in the yellow pages. Business name registration must be renewed on a regular basis.

Businesses may also register to obtain an Australian Company Number (ACN). The company is identified by the ACN along with its name and status. A name cannot be registered it if is identical to another business name or if the name is not considered acceptable for registration. If a company decides to trade under a name other than the registered company name, it must register that trading name as a business name in each state where it will use that name.

Business name registration and Australian Company Registration do not automatically allow applicants to use that name as a trademark. If the business name includes words that identify goods or services being provided, it is advisable to apply for trade mark registration. Failure to register a business name as a trademark means that another business could register your business name as a trademark for their goods or services and you would not have the right to use it.

Trademarks

A trademark is used to distinguish goods and services of one trader from those of another. A trademark can be a letter, number, word, phrase, sound, smell, shape, logo, picture, aspect of packaging or any combination of these. Registration of a trademark provides the exclusive right to use, license and sell within Australia the goods or services for which the trademark is registered. It is important to conduct a search of existing trademarks before using a mark or applying for registration. If the mark is already registered or in use by someone else, you can be sued for trademark infringement.

Fair Trading

Australia has comprehensive legislation governing fair trading practices. The Trade Practices Act 1974 (Cth) applies to situations that fall within the Commonwealth’s legislative authority. However, states have also enacted their own fair trading legislation which contain similar consumer protection provisions. Some of the key provisions of the legislation make it unlawful to make false claims about a product or service, operate in a misleading or deceptive manner, or engage in unconscionable conduct.

Taxation Obligations

It is also important for small business to have a sound understanding of their taxation obligations, including the Pay As You Go system for reporting and paying tax on business and investment income, the Fringe Benefit Tax (where an employer provides fringe benefits to its employees), the Payroll Tax (which applies to Queensland employers whose wage payments throughout Australia exceed the exemption threshold of $16,346 per week in any month), as well as Goods and Services Tax collection obligations.

Workplace Safety

Workplaces are subject to the provisions of the Workplace Health and Safety Act 1995. In addition, employers are required to whole a WorkCover policy of accident insurance to cover the cost of compensating a worker who is injured at work.

Conditions of Employment

Where a business has employees, the employment relationship is generally governed by the employment contract. However, the rights and obligations of the parties are also influenced by relevant federal and state legislation and, in some instance, relevant industrial instruments such as awards or enterprise agreements. Awards set out the minimum conditions of employment for employees in particular jobs. Awards prescribe things such as rates of wages, hours of work, overtime payment, leave entitlements and occupational superannuation.

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