Small Business – You Are not Alone
Office of the Small Business Commissioner
The Small Business Commissioner is an Australian first, and was created to promote greater fairness in business through its four main functions – dispute resolution, investigation of small business complaints, information and education, and review of government practices.
In its three years of operation The Small Business Commissioner has been involved in over 2500 disputes and achieved a remarkable 75% success rate.
Disputes valued at more than $100 million have been resolved and saved Victorian small business millions of dollars in litigation fees and thousands of wasted hours locked in court system.
The Small Business Commissioner operates under its own legislation, the Small Business Commissioner Act 2003. Later this year, the Office of the Small Business Commissioner will also have alternative dispute resolution functions under the new Owner Drivers and Forestry Contractors Act 2005. This will benefit both owner drivers and their hirers.
Small business – especially in regional Victoria – has quickly appreciated that asking the Commissioner’s Office for assistance is far less intimidating and certainly more economical with the cost of $95 per party.
“Mediation and settlement is on a pragmatic commercial basis, which has allowed all parties to re-establish business relationships or move on without the debilitating effects of a lingering commercial dispute,” the Small Business Commissioner, Mark Brennan, told the Construction Material Processors Association.
“With mediation usually held locally the convenience, low cost and informal nature of the process has also been appreciated,” he said.
The advice the Commissioner offers to small business is:
- be informed—know your rights and obligations
- be smart —mediate your disputes and get on with business
- be fair—ensure your ongoing business relationships
- be aware—of Government regulation.
Case Study
The Commissioner’s Office recently mediated in regional Victoria between two small businesses that were in dispute regarding the supply of goods.
The problem, according to the retailer who ordered the goods, was that they were delivered two weeks late and he missed the peak-selling period for which they were ordered.
The retailer refused to pay because of the lost sales opportunity additionally claiming that several of the parts were damaged. The relationship soured, a stand off occurred and the commercial relationship had broken down.
The supplier submitted an application to the Small Business Commissioner under the Small Business Commissioner Act 2003 seeking payment.
The Small Business Commissioner realised the dispute actually involved three parties, the supplier, the retailer and the freight company.
The Commissioner invited the three parties to attend mediation. Although initially reluctant the freight company finally agreed to attend.
Although each party had its own version of events the mediator was able to have all parties agree on the common issues.
An investigation by the freight company revealed a new contractor had been hired on a trial basis and was not aware of all the requirements of his job.
The mediation concluded with all parties agreeing there had been misunderstandings among all of them. Compensation was agreed and new commercial agreements were developed.
The benefit of the mediation was the three parties developed their own settlement agreement and realised they needed each other’s support.
The supplier has a renewed contract with the retailer and the freight company is working with both parties. The mediation cost each party $95, was conducted in their town and completed in three hours.
The Small Business Commissioner’s Office can mediate any business to business dispute.
The SBC can be contacted on: 13 22 15 or 1800 136 034 (toll free) TTY 03 9651 7596 or visit the website at www.sbc.vic.gov.au
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