COVID-19 - Important Information - Version: 27 March 2020 - Quantum Partners
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COVID-19 – Important Information
Version: 27 March 2020Disclaimer
The information contained in this document is general in nature. It has not been
tailored for your circumstances.
The position is updating rapidly and all readers must obtain independent advice on
the information contained in this document.
2 hitchadvisory.comLock Down - Commonwealth Ordered Closures
(Stage 1)
• Stage 1 Measures
• 100 person limit indoors
• 500 person limit outdoors
• 1 person per 4 square metres
• 1.5 metre self-imposed distance between persons
• Avoid non-essential travel
• Restrictions on entering aged care facilities
• Please note Stage 1 continues to apply unless superseded by Stage 2 (Next Page).
• More resources here:
• Australian Government Department of Health - https://www.health.gov.au/
• Closure Poster - https://www.health.gov.au/resources/publications/coronavirus-covid-19-temporary-closure-
poster-for-businesses
3 hitchadvisory.comLock Down - Commonwealth Ordered Closures
(Stage 2)
Pubs
Indoor Sporting
(exc. bottle Clubs Gyms Cinemas
Venues
shops)
Restaurants Religious
Entertainment and Cafes Gatherings and
Casinos Nightclubs
Venues (exc. Places of
Takeaway) Worship
4 hitchadvisory.comLock Down - State-by-State Closure Details
State Description
• Schools remain open however, it is recommended that parents keep their children at home unless parents are required to work.
• Supermarkets, shops and shopping centres to remain open however it is advised people do not congregate there.
NSW • Delivery, mail service, freight and logistics will continue to operate.
• Medical centres and pharmacies will continue to operate.
• Tradesmen, plumbers and electricians will continue to operate.
• Schools to be closed as of Tuesday, 24 March 2020 as school holidays brought forward. Subject to the advice of the Victorian and
Commonwealth government, schools to return at the commencement of the next schooling term on 13 April 2020.
• Supermarkets, shops and shopping centres to remain open however it is advised people do not congregate there.
VIC • Delivery, mail service, freight and logistics will continue to operate.
• Medical centres and pharmacies will continue to operate.
• Tradesmen, plumbers and electricians will continue to operate.
• Family visits to prisoners are suspended as of Saturday, 21 March 2020.
• Schools remain open however, it is recommended that parents keep their children at home unless the parents are required to work.
• Supermarkets, shops and shopping centres to remain open however it is advised people do not congregate there.
• Delivery, mail service, freight and logistics will continue to operate.
QLD • Medical centres and pharmacies will continue to operate.
• Tradesmen, plumbers and electricians will continue to operate.
• Family visits to prisoners are suspended as of Monday, 23 March 2020.
• Closure of domestic and international borders as of Tuesday, 24 March 2020.
WA • Schools remain open for now until further advised.
hitchadvisory.comLock Down - State-by-State Closure Details
State Description
• Closure of domestic and international borders as of Tuesday, 24 March 2020.
• Schools remain open for now until further advised.
• Family visits to prisoners are suspended as of Monday, 23 March 2020.
SA
• Trading hours of Supermarkets has now been deregulated and will operate 24 hours.
• Shopping hours will also be extended on weekends (temporary).
• Closure of domestic and international borders (measures already in place).
• Schools remain open however, it is a matter for the parents to decide whether to send their children to school. Subject to the advice of the
Northern Territory and Commonwealth Government, the next school term is to commence as normal.
NT • Supermarkets, shops and shopping centres to remain open however it is advised people do not congregate there.
• Delivery and mail service will continue to operate.
• Medical centres will continue to operate.
• Tradesmen, plumbers and electricians will continue to operate.
• Schools to be closed as of Tuesday, 24 March 2020.
ACT • ACT is following NSW and VIC in the implementation of its closures given its geographic proximity to these States.
• Closure of domestic and international borders (measures already in place).
TAS
• Schools remain open however, it is a matter for the parents to decide whether to send their children to school.
6 hitchadvisory.comReporting – State-by-State
Legal Basis for Reporting:
• Health Authority - Duty to notify health authority (in reality the health authority will likely notify you) - Common law duty of care and potential negligence claims
for both customers and employees;
• Safe Work Authority - Duty to notify the safe work authority - Work health and safety legislation;
• Employees and Customer - Duty to notify members and employees - Common law duty of care and potential negligence claims for both customers and
employees.
NSW VIC QLD WA
https://www.safework.nsw.gov.au/ https://www.worksafe.vic.gov.au/ https://www.worksafe.qld.gov.au/ https://www.commerce.wa.gov.au/wor
ksafe
https://www.health.nsw.gov.au/Pages/ https://www.dhhs.vic.gov.au/ https://www.health.qld.gov.au/
default.aspx https://healthywa.wa.gov.au/Articles/A
_E/Contact-details-for-population-
public-health-units
SA NT ACT TAS
https://www.safework.sa.gov.au/ https://worksafe.nt.gov.au/ https://www.accesscanberra.act.gov.a https://www.worksafe.tas.gov.au/
u/app/home/workhealthandsafety
https://www.sahealth.sa.gov.au/wps/w https://health.nt.gov.au/ https://www.dhhs.tas.gov.au/
cm/connect/Public+Content/SA+Healt https://health.act.gov.au/
h+Internet/
7 hitchadvisory.comStimulus - Commonwealth Measures
What Description Announcement Date
$750 cash stimulus for social security and veteran income support recipients and eligible
concession card holders.
Corona Virus Supplement (A) 12 March 2020
https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet-
Payments_to_support_households.pdf
Job Seeker, Youth Allowance, Parenting Payment, Farm Household Allowance and Special
Benefit increased by $550 per fortnight for new and existing participants over the next 6 months.
Corona Virus Supplement (B) (Note – also applies to sole traders and casuals who have seen their income drop below $1,075 22 March 2020
per fortnight).
https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet-Income_Support_for_Individuals.pdf
Additional $750 to social security and veteran income support recipients and eligible concession
card holders.
Payment to Support Households 22 March 2020
(Note – not applicable to those receiving increased Job Seeker etc.).
$10,000 drawing in 2019/2020 and $10,000 in 2020/2021 tax free for Corona Virus Supplement
eligible persons.
Superannuation 22 March 2020
(Note – also applies to sole traders and casuals who have seen their income drop by 20%.)
https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet-Early_Access_to_Super_1.pdf
More information here:
https://treasury.gov.au/coronavirus
8 hitchadvisory.comStimulus - Commonwealth Measures
What Description Announcement Date
Instant Asset Write-Off Instant depreciation write-off increased from $30k to $150k for the financial year ending 30 June 2020. 12 March 2020
Up to $50k (min. $20k).
100% of PAYG during March quarter to be remitted to employers.
Turnover cap of $50m.
Employer Cash Flow (A) Revised 22 March 2020
28 April 2020.
https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet-Cash_flow_assistance_for_businesses_0.pdf
Additional payment equal to April payment.
Employer Cash Flow (B) 22 March 2020
Payable monthly July to October.
Additional Payment - July Employers will receive another payment as at 28 July 2020 equivalent to that received under the above measures. 22 March 2020
$0.50 per $1.00 in writing of SME loans up to $40 billion.
SME Guarantee Scheme 22 March 2020
Applies to unsecured loans up to $250k over 3 years.
Statutory Demands - $ Demand sum increased from $2,000 to $20,000 22 March 2020
Statutory Demand - Time Compliance period increased from 21 days to 6 months. 22 March 2020
Insolvent Trading 6 month relief to personal liability for companies trading whilst insolvent. 22 March 2020
ATO Debt Tailored plans and withholding of wind-ups and DPNs. 22 March 2020
Demand sum increased from $5,000 to $20,000 22 March 2020
Bankruptcy Notice - $
9 hitchadvisory.comStimulus - State Measures
State Description
• Waiver of Payroll tax for 3 months (payroll up to $10m);
• Increased payroll tax threshold of $1m from 1 July 2020;
NSW • Waiver of some fees for hospitality businesses;
• More information:
• https://preview.nsw.gov.au/covid-19
• SME (less than $3m annual payroll) will have current year payroll tax refunded and deferral of the first 3 months of 20/21 to January 2021.
• Rent relief for commercial tenants in government buildings;
VIC • $1.7b stimulus to be detailed;
• More information:
• https://www.business.vic.gov.au/disputes-disasters-and-succession-planning/illness-and-business-management-plan/coronavirus-business-support
• Payroll tax deferral to August 2020;
• Low interest loan of $250k 12 months interest free to retain staff;
QLD
• More information:
• https://www.ditid.qld.gov.au/covid-19/business-support
• Payroll tax threshold increased to $1m;
• $17,500 one-off grant for businesses paying between $1m and $4m;
WA • Application for deferral for businesses paying less than $7.5m in wages;
• More information:
• https://www.wa.gov.au/organisation/department-of-the-premier-and-cabinet/coronavirus-covid-19-western-australian-government-response
• $350m stimulus package to be detailed.
SA • More information
• https://www.premier.sa.gov.au/
NT • Detail to follow.
ACT • Detail to follow.
• $20m in interest free 3 year loans for businesses with turnover up to $5m;
• Hospitality waiver for payroll tax;
TAS • Other businesses with payroll up to $5m can apply for payroll tax relief;
• More information:
• http://www.premier.tas.gov.au/documents/FACT_SHEETS_-_STIMULUS_PACKAGES_Final-V2.0.pdf
10 hitchadvisory.comEmployees – Downturn Measures
• There is no doubt that COVID-19 will have a significant impact on the workforce.
• Businesses can spend between 40 – 80% of gross revenue on salaries and benefits combined.
Salaries alone can account for 20 – 50% depending on the industry. In industries such as
hospitality and retail, wages can often be the greatest operational expense.
• Whilst we are mindful that the virus will end and businesses will need their workforce in order to
be able to resume trade (and therefore business should be encouraged not to make any rash
decisions), the reality is that many businesses will need to take some steps to reduce their wage
costs.
• We explore some of the most likely measures that businesses may look to implement during this
time. Remember – every business is different and there is no ‘one size fits all solution’.
Decisions you take in respect of your workforce are key and reducing the risk of a claim or
penalty is important.
• Preliminary comment – it will not be possible to answer your specific questions regarding your
individual team or circumstances in this forum (as everyone’s situation is different and the risks
of getting it wrong are too high). We will however provide general guidance on possible options.
We are then happy to work with you offline to create a specific strategy for your business.
11 hitchadvisory.comEmployees – Downturn Measures
What Description Links
• If you have a mixture of casual and
permanent workers, it is an unfortunate
reality that your casual workforce is
likely to be the first area in which costs
are saved.
• Cutting shifts – casual workers are not
https://www.fairwork.gov.au/employee-
guaranteed hours or wages (exception
Casual Workforce entitlements/types-of-employees/casual-
below)
part-time-and-full-time/casual-employees
• Note however that casual workers who
are regularly and systematically
engaged may have an unfair dismissal
claim if their regular hours are ended or
their employment is terminated.
12 hitchadvisory.comEmployees – Downturn Measures
What Description Links
• Where a business is in distress and workers are not
needed (i.e. due to reduced trade) can a business force
employees to take accrued paid annual leave? Short
answer – no.
https://www.fairwork.gov.au/leave/annual-
Forcing Annual • However, Employers and Employees are encouraged to
leave/directing-an-employee-to-take-
Leave constructively work together on a solution. There is little
annual-leave
point in an Employee preserving their annual leave if the
business fails.
• Exception – forced leave may be authorised where there
is a large leave balance.
• Leaving aside “Stand Down” (discussed later), can a
business in distress force employees to take unpaid
Unpaid Leave leave? Short answer no – but again cooperation and
negotiation is recommended. See next slide for impact
of unpaid leave on access to Govt benefits.
13 hitchadvisory.comEmployees – Downturn Measures
• If employees take unpaid leave voluntarily (i.e. as opposed to losing their job), what impact does this have
on their ability to access Centrelink payments?
• The Australian Government has provided current guidance on this topic:
https://www.servicesaustralia.gov.au/individuals/news/more-financial-support-coronavirus-affected-job-
seekers.
• In summary, there is expanded eligibility for JobSeeker Payment and Youth Allowance for job seekers.
Access to these payments if you’re:
• a permanent employee who has been stood down or lost your job
• a sole trader, self-employed, a casual or contract worker whose income has reduced
caring for someone who’s affected by coronavirus.
• Unless and until the Government states otherwise, our view is that permanent employees who consent
to taking unpaid leave may not have access to job seeker payments.
14 hitchadvisory.comEmployees – Downturn Measures
What Description Links
• Where a business is in distress and needs to reduce
wages to try and remain viable, can it forcibly alter a
permanent employees conditions (e.g. wage, hours,
days per week)? Short answer – no. https://www.fairwork.gov.au/about-
Alteration to
• Workers under an Award must be consulted with and us/news-and-media-releases/website-
hours/days and
most Awards have strict processes to be followed for news/coronavirus-and-australian-
conditions
alterations to hours/days. workplace-laws#roster-changes
• For non-award employees, employers should work
collaboratively with employees to understand whether
alterations to conditions are workable for both parties.
15 hitchadvisory.comEmployees – Downturn Measures
What Description Links
• Under the Fair Work “Stand Down” provisions, an
employer can stand down its workforce without pay in
limited circumstances. Jobs are not terminated, simply
that wages are placed on hold.
• Advantage over redundancy in that redundancy
payments are not made. Stand down may be selective.
• There are limited circumstances where this provision
https://www.fairwork.gov.au/about-
can apply.
us/news-and-media-releases/website-
Stand Down • The employer must be able to demonstrate that:
news/coronavirus-and-australian-
• there is a stoppage of work
workplace-laws#stand-down
• the employees to be stood down cannot be usefully
employed (which is not limited to the work an
employee usually performs)
• the cause of the stoppage must also be one that the
employer cannot reasonably be held responsible
for.
16 hitchadvisory.comEmployees – Downturn Measures
What Description Links
• Starting point - stand down is not typically allowable due
to a business downturn.
• Examples of where stand down may be utilised:
• Enforceable government direction to close and no
ability to work elsewhere
• Stoppage of work due to lack of supply beyond the
employer’s control (the Qantas scenario)
https://www.fairwork.gov.au/about-
• Large amount of workforce in quarantine or ill such
Stand Down us/news-and-media-releases/website-
that the business cannot continue
(continued) news/coronavirus-and-australian-
• Inability to get key components due to
workplace-laws#stand-down
circumstances beyond control (e.g. manufacturer of
copper pipes cant source copper due to mines
closing and no alternative supply channels).
• Caution should be taken – likely not available for
businesses ”downstream” – e.g. a supplier of treadmills
may not be able to rely on gym closures to stand down.
As they could arguably supply private customers etc.
17 hitchadvisory.comEmployees – Downturn Measures
What Description Links
• Where stand down provisions are not available and an
employer cannot continue to employ permanent
members of staff due to the impacts of COVID-19 (and
avenues such as annual leave or unpaid leave are not
viable), then an employer may consider redundancy.
• Redundancy must be genuine or unfair dismissal may
https://www.fwc.gov.au/unfair-dismissals-
arise.
benchbook/what-dismissal/what-genuine-
• A dismissal is a case of genuine redundancy when:
Redundancy redundancy
• the employer no longer requires the person's job to
be performed by anyone because of changes in the
operational requirements of the employer's
enterprise; AND
• the employer has complied with any obligation
imposed by an applicable modern award or enterprise
agreement to consult about the redundancy.
18 hitchadvisory.comEmployees – Downturn Measures
What Description Links
• Before making an employee redundant due to economic
downturn associated with COVID-19, consider whether there is
anything else that employee could be redeployed to do in your
https://www.fwc.gov.au/unfair-dismissals-
organisation.
benchbook/what-dismissal/what-genuine-
• Ensure you have explored all options – e.g. consulted with them
redundancy
regarding reduced hours, considered annual leave or unpaid
leave etc.
https://www.fairwork.gov.au/how-we-will-
• If redundancy is your only option, you will be required in some
help/templates-and-guides/fact-sheets/minimum-
Redundancy instances to pay redundancy pay. Redundancy pay can be
workplace-entitlements/notice-of-termination-and-
calculated using the Fair Work calculators/tables but keep in
redundancy-pay
mind any more favourable terms of your employment contracts.
• Redundancy pay will usually apply in addition to the paid notice
https://www.fairwork.gov.au/ending-
provisions under an employment agreement.
employment/redundancy/who-doesnt-get-
• Accrued annual leave will also need to be paid out.
redundancy-pay
• Different calculation mechanisms will likely apply for small
business employers (less than 15 employees).
19 hitchadvisory.comEmployees – Working From Home
Issue Comments
Can Employers direct employees to work from home? Most employment agreements will allow for this. Further, Employers are advised to check specific awards and Enterprise Bargaining Agreements.
Do Employers have a duty of care to protect
Yes. Employer’s have a primary duty to ensure, as far as reasonably practicable, the health and safety of their employees and all persons in their workplace.
Employees from COVID-19?
In the current environment, Employers should (at least):
• Provide information about health risks posed by COVID-19 (as reasonably obtainable from Government Health sources);
What can/should Employers do?
• Provide instructions about ways to minimise those health risks; and
• Monitor, assess and take steps to mitigate the risks that COVID-19 poses to health and safety of workers in their workplace.
Given the Government’s broader directions on self-isolation, Employers may implement alternate policies for their Employees.
That is, Employers may issue lawful and reasonable directions to Employees in order to manage health and safety risks, including:
• Requiring people to stay away from work to manage infection risks; or
• To ensure compliance with recommendations/directions by public authorities.
Given the rapid development of the outbreak and its effects, it is advisable that (in consultation with their Employees) Employers should make arrangements for the access and sharing of information with
Employees 24/7 (i.e. Skype, email, instant messaging)
Where an Employer opts to implement a WFH policy, it is essential that Employees:
Tips and Strategies – Working From Home (WFH)
• Adhere to all Employer policies and procedures;
• Be contactable during normal working hours;
• Ensure fitness for work requirements are met – that is, if staff members are unwell or unable to work due to other reasons, then leave entitlements should be accessed
• Ensure home offices or worksites comply with work, health and safety laws, regulations and requirements;
• Maintain accurate and up to date records of hours worked at home;
• By prior agreement, where required and necessary, provide Employer or other approved parties with access to home-office for matters such as WHS inspections.
It is important to note and remember that the Employer will continue to remain liable for the Employees’ work, health and safety (as far as is reasonably practicable in relation to their duties) even if
Employees are directed to WFH.
20 hitchadvisory.comOccupancy – Landlord/Tenant Relationship
• At this point in time, the Australian Government has not provided any direction in respect of the abatement of commercial
rents due to COVID-19 impacts on trade.
• In fact as it stands, the majority of industries remain open (with the exception of restaurants and cafés for dine in,
cinemas, gyms, pubs/clubs, places of worship and those that can’t operate due to patron restrictions etc).
• Whilst some businesses may be able to lawfully trade for the time being, we understand that many have experienced
significant downturn in their trade.
• For many businesses, rent and wages are their key overheads.
• If you are unable to continue to viably trade your business due to COVID-19 impacts, we suggest you immediately
approach your landlord to discuss potential rental reduction or abatement. Whilst they are not obliged to provide
abatement or concessions (i.e. the Lease stands), it is likely that most will be open to the discussion with the view to
avoid the tenant’s business failing.
• If you are unable to trade due to the Government restrictions (meaning you can’t use your premises), it could be argued
that the Lease is “frustrated” – allowing for the Lease to be terminated. However, this would depend on a number of
matters and is not ”clear cut”. In reality, most tenants don’t want to lose their premises and frustration serves only to end
the contract - so it may not be useful. We anticipate that the major landlords will put forward their policies to tackle
COVID-19 in the next week.
• Importantly – no banks have expressed a willingness to defer commercial property principal and/or interest repayments
to our knowledge. Landlords would, in this instance, need to defer to loss of rent insurance (which is uncommon for
default in the commercial market) or apply to their financier under ordinary grounds of hardship.
21 hitchadvisory.comLeases – Force Majeure
What Description & Operation When will it apply
• ‘Force majeure’ is a civil law concept, a creature of Contract that will
only apply if such a clause appears in a Contract/Lease.
Many commercial leases will not include a force
• Designed to provide relief to a party under a Contract that is affected by majeure clause.
an unforeseeable matter or event beyond their control.
As a commercial tenant, you will only be offered relief
• Some documents will provide an exhaustive list of what constitutes a on the basis of ‘force majeure’ to the extent that:
force majeure event, while others will refer to the term broadly. 1. The Lease contains a force majeure clause;
2. COVID-19 (as a global pandemic) falls within the
Force Majeure
• Application comes down to terms of the individual Contract/Lease. definition of force majeure in the relevant Lease;
3. The force majeure event (i.e. COVID-19) directly
• Relevant considerations: prevents you from being able to perform your
1. Look to the relevant Lease/Contract. obligations under the Lease; and
2. Has a force majeure event occurred (according the definition 4. You comply with any other obligation imposed on
contained in the Lease, if any); you under that clause (e.g. to notify the landlord of
3. What obligation under the Lease does that event prevent me the force majeure event).
from complying with?
22 hitchadvisory.comLeases – Doctrine of Frustration
What Description & Operation When will it apply
• Common law ‘Doctrine of Frustration’ states that there should be an
automatic mutual discharge of the contract where performance becomes
Frustration will only occur if the obligations under the
impossible.
Lease cannot be performed “because the
circumstances in which performance is called for would
• Legal consequence is that the Contact is terminated from the point of
render it a thing radically different from that which
frustration (any obligations arising prior to that point will remain).
was undertaken by the contract”.
• Normally, a contract will not be found to be frustrated;
1. if there is an existing force majeure clause in the Lease covering
the relevant circumstances which are claimed to be the frustrating
Doctrine of Frustration event;
2. a delay in an obligation being able to be performed, unless such
Relevant Legislation:
a delay is for an unreasonable time; or
3. if the parties have merely suffered hardship, unforeseen loss, or
• NSW (Frustrated Contracts Act 1978)
the burden of performance has increased.
• South Australia (Frustrated Contracts
Act 1988)
• Victoria (Australian Consumer Law and Fair
• Relevant considerations:
Trading Act 2012)
1. Has the current situation made it impossible for me to perform my
obligations or merely harder and/or more costly?
2. Standard of proof is very high.
23 hitchadvisory.comCash-Flow – Debtor/Creditor Relationship
• Some commentators have raised the impact of force majeure clauses in slowing down demands for money.
• Force majeure is limited to where situations, beyond parties’ control, render performance impossible. It will not generally
extend to cost/non-payment, but specific contractual wording should be reviewed.
• Debtors will need to speak with creditors immediately to sure-up supply and payment terms.
• Despite the new measures put in place regarding statutory demands, creditors retain the right to refuse supply and
become comfortable with their ability to get paid in the future.
• Whilst directors have some relief from insolvent trading, likely March to September, businesses which were insolvent
prior to March 22 are advised to speak to Hitch Advisory or an insolvency practitioner.
24 hitchadvisory.comConsumer Law – Cancellations, Credits and Refunds
Circumstance Description
Where a consumer has booked goods and services, what happens in the event of cancellation or
non-supply (and the type of remedy they may receive if any) depends on the circumstances.
• Consumer cancels voluntarily: If there is no government restriction preventing the
goods/services and the consumer simply cancels, depending on any T&Cs to the contrary, the
consumer will not be entitled to a refund or credit etc (again, depending on the T&Cs) and
may be obliged to continue with their commitment.
• Supplier cancels voluntarily: If a supplier cancels voluntarily (e.g. no government
restriction), then most likely a consumer is entitled to a refund or other remedy.
Goods and Services • Government restriction: provided the booking was made before the government restriction
was contemplated, then the T&Cs will be the starting point as to what should occur. If the
T&Cs are silent, if a good/service cannot be postponed reasonably then a refund or credit
should be provided.
• There is one catch however - keep in mind under the Australian Consumer Law that there are
strict penalties for charging for something you know you can’t supply – e.g. debiting for a food
delivery service when you know you can’t deliver the meals this fortnight or charging for a
magazine subscription if you know you aren’t going to print this month (regardless of what
your T&Cs say).
25
hitchadvisory.comConsumer Law – Cancellations, Credits and Refunds
Circumstance Description
• If the Event is cancelled voluntarily by the organiser, consumers are entitled to a refund.
• If the Event is cancelled due to circumstances beyond the organiser’s control (e.g. venue
capacity limits, or being held at a restricted business such as a restaurant), then the event
Events
holder’s terms and conditions will govern the remedy. Where it is possible to postpone and the
T&Cs allow, then postponement or a credit is reasonable. Where there is no possibility of
postponement, the ACCC will likely take a view that a refund should be provided.
Similarly to events, if travel is cancelled due to a government restriction, then the terms and
conditions of the booking will determine the remedy to be provided but ultimately a refund, credit or
Travel postponement should be offered. You will note most airlines are refunding – only crediting.
Travel insurance claims seem to remain active in the market.
Direct debit memberships should not be deducted for any period of closure. Effectively,
Gyms
memberships will generally be placed on suspension – subject to any membership T&Cs.
Cancellations by the consumer or business for reasons other than COVID-19 impacts are covered
Meal Delivery
on the next slide in respect of any other good/service. However, the ACCC is clear that meal
Services 26 if they know they can’t supply at this time.
delivery services must not take debits
hitchadvisory.comConsumer Law – Cancellations, Credits and Refunds
Circumstance Description
If a business can’t deliver their committed good or service at this time, can they offer a substitute
good or service to consumers?
Whilst a business may offer a substitute, it may not force a consumer to take the substitute –
unless the difference in the supplied good or service is minor and subject always to the terms
and conditions of supply.
For example, if you have shopped online with Coles or Woolworths you will note they may
Substitutions
substitute branded products due to availability issues. This is in their Terms and Conditions.
However, if you have ordered 50 bottles of hand sanitiser for employees to use at their Point of
Sale and the retailer says they can’t supply it but they can supply 50 blocks of soap this is not an
appropriate substitution and the consumer is not obliged to accept it (unless the T&Cs allow for
this).
Wherever possible we do recommend substitutes and solutions are offered, but not forced.
27
hitchadvisory.comLegal advice for business.
Uncomplicated, relevant, expert advice.
hitchadvisory.com
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