Reading time: 3 minutes

All too often, company refund and repair policies do not line up with the Australian Consumer Law (ACL), leading to employee confusion about whether they should allow a refund or replacement of that product. Below, we provide five tips that employees in any industry should know. But remember, you should always check with your manager about your employer’s return policies first!

General Consumer Rights for Refunds, Repairs and Replacements

If a business sells a product worth under $40,000, or sells a product for personal or household use, then that business will automatically provide consumer guarantees, including: 

  • The product is of an acceptable quality;
  • The product is fit for the purpose specified when purchasing the product;
  • The product is safe to use; and
  • The product matches the description advertised or any representation made by a salesperson

If there is a minor defect, then the business can choose to provide either a repair, replacement or refund of the product. The business must pay for all costs incurred to get the product back to the premises.

If there is a significant problem, then the business must offer a replacement or refund of the product, either of which the consumer can choose to accept. For example, the product is:

  • Unsafe,
  • Doesn’t do what the description stated, or
  • The problem cannot be easily fixed.

Retailers must accept responsibility for the product, and cannot redirect customers to the manufacturer or importer.

1. When Can the Consumer NOT Return the Product?

Under the ACL, consumers have no right to return a product if they:

  • Change their mind;
  • Found the product cheaper elsewhere;
  • Were aware of the fault before buying it;
  • Misused the product;
  • Used the product for over a reasonable period; or
  • Realised they bought the wrong product.

But, if your employer’s policy allows customers to do any of the above and remain entitled to an exchange or refund, then you must apply that policy!

2. Customer has a Broken Product and an Expired Warranty

Even when the warranty is expired, the customer’s consumer guarantees may still exist. The ACL does not provide that consumer guarantees will not apply after a specific date. However, they provide for a reasonable period depending on the nature of the good. For example, a grand piano may be protected by consumer guarantees much longer than a smartphone.

3. “No Refund” policies are not allowed

Businesses cannot rely on a “no refunds” policy. This is illegal, regardless of the circumstances. Even if the product is on sale, customers may claim a refund for their product.

4. Consumer Refunds After 14 or 30-day policy

Consumers are entitled to a refund for any product provided that the time taken to request the refund is ‘reasonable’. Time limits set by your employer for 14 or 30 days may not apply in some circumstances.

5. Do I Have to Refund in Cash or Can I Give Store Credit?

It is the consumer’s right to have their refund in the form of their original payment. It is illegal to force consumers to accept store credit instead of refunding them their original card, cheque or cash payment.

Questions? Get in touch with LegalVision’s consumer lawyers on 1300 544 755.

Webinars

Construction Contract Essentials

Thursday 12 August | 11:00 - 11:45am

Online
Understand how construction contracts are drafted and how to protect your construction business.
Register Now

Startup 101: Understanding Cap Tables and ESOPs

Thursday 19 August | 11:00 - 11:45am

Online
Cap tables and employee share option plans are essential for fast-growing startups. Learn more with this free webinar.
Register Now

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.

The majority of our clients are LVConnect members. By becoming a member, you can stay ahead of legal issues while staying on top of costs. From just $119 per week, get all your contracts sorted, trade marks registered and questions answered by experienced business lawyers.

Learn more about LVConnect

Need Legal Help? Get a Free Fixed-Fee Quote

If you would like to receive a free fixed-fee quote or get in touch with our team, fill out the form below.

  • 2020 Excellence in Technology & Innovation – Finalist – Australasian Law Awards 2020 Excellence in Technology & Innovation Finalist – Australasian Law Awards
  • 2020 Employer of Choice – Winner – Australasian Lawyer 2020 Employer of Choice Winner – Australasian Lawyer
  • 2021 Fastest Growing Law Firm - Financial Times APAC 500 2021 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 AFR Fast 100 List - Australian Financial Review 2020 AFR Fast 100 List - Australian Financial Review
  • 2021 Law Firm of the Year - Australasian Law Awards 2021 Law Firm of the Year - Australasian Law Awards
  • Most Innovative Law Firm - 2019 Australasian Lawyer 2019 Most Innovative Firm - Australasian Lawyer