Consumer Rights Act 2015 – how to avoid penalties

If you are a business selling goods or services to consumers you should be aware that the Consumer Rights Act 2015 came into force on 1st October 2015 which imposes strict new penalties for those who breach Consumer Law.

The increased awareness amongst consumers following media coverage and the increased use of social media makes it very important for you to take a second look at your practices to ensure compliance with the changes from the outset.

To point out some of the changes in very brief detail:

• For the first time rights on digital content have been set out in legislation. The Act gives consumers a clear right to the repair or replacement of faulty digital content, such as online film and games, music downloads and e-books.
• There are also new, clear rules for what should happen if a service is not provided with reasonable care and skill or as agreed. For example, the business that provided the service must put any defect right, or if this is not practical, give the consumer some money back.
• With regards to unfair contract terms, the new rules limit the ability of businesses to exclude or limit liability and also enhance enforcement powers.
• If the consumer relies on anything you or your sales team say, or any written material, before entering into the contract, you are likely to be bound by it as this can now be deemed to be binding contractual terms.

What you need to do:

Following the implementation of the new Act, it is important that you re-evaluate your Terms and Conditions as there is now not only a requirement for all terms to be incorporated into an agreement, but also for unusual or onerous terms to be ‘specifically highlighted’. This means that certain terms which may once have been implied in an agreement must now be made as straightforward and unambiguous as possible so that a Consumer is left with no uncertainty as to the contract they are entering into.

We can help you review your procedures and your customer documentation such as marketing materials, Terms & Conditions, and cancellation and returns policies.

As well as this, clear and accurate records must now be kept of all oral agreements made between a salesperson and a Consumer, increasing the scope of verbal agreements, so you should also consider training your sales people on how they should now be careful about claims and promises they make about your products and services.