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Unfair contract headache for banks at Royal Commission

Tuesday, June 05, 2018

We’re mighty proud of our achievement in securing unfair contract protections for self-employed, small business people. It was a campaign we started in 2009. Here’s our campaign history. It was tough work.

The Australian Bankers Association strongly opposed us and we had several polite but unsuccessful meetings with them. They fought to kill the Bill in 2015, but thanks to some hard work and the Senate our campaign succeeded. The laws started in late 2016.

Now at the Banking Royal Commission some of the banks are feeling the heat over not fixing their unfair small business contracts. Suncorp Bank is in the gun for its unfair contract failings.  The Bank regulator, ASIC, found itself being criticised by the Royal Commissioner for not forcing the banks to fix their contracts.

But to be fair, we’ve been most impressed with NAB in the way (after first stuffing up!) that it has implemented really good (now ‘fair’) small business contracts. In our October 2017 analysis of its new standard form contract, we said we couldn’t find ‘anything sneaky’.

Here’s the thing. Commercial contracts are the foundation upon which a good economy functions. Commercial contracts are supposed to have a balance in the power relationship. Allow a power imbalance in the contracts and bad behaviour will follow.

Much of the bad behaviour of the banks can be traced to the banks’ achieving ‘dictatorial’ power over customers. Stop the power imbalance and more ethical behaviour is imposed. The nature of the contracts which the banks have determines the bank culture! It is that simple! And that’s the huge importance of the unfair contract laws.

At Self-Employed Australia we know these laws intimately. We initiated and ran the campaign to create the laws. Now, for our Protected Members, if you have an unfair contract we are well placed to assist.
  • Details are here.
  • You can join here.
  • Special 3-year membership is here (big discount).
And members can access our contract templates.

These templates embody the practice of fair contract. And we provide personal assistance to members with their contracts. It’s what we do!

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