“It's about the passion”

Developing improved dispute resolution processes for self-employed/small business people

23 May 2011

The federal government has released a discussion paper on options for developing better dispute resolution procedures for self-employed/small business people. We strongly support this and will be active by way of submissions and discussion.

Update 4 July 2011: Case Study: Guy fought the law (and the law won)
Update: 26 May 2011
The Abbott opposition points out that the government is just adopting its policy from the 2010 election. Such is politics! But it's good to have cross-party political support on the issue.


Summary of the Discussion Paper
The paper canvasses 4 options for improving dispute resolution:
  • Option One: Establish a telephone hotline to direct people to dispute resolution services.
  • Option 2: Create a National Dispute Resolution Service providing referral services as per one (above) but also a mediation service. Have a website and phone service for information. Conduct awareness and education services. Target areas where there is a high incidence of disputes occurring.
  • Option 3: Create a National Small Business Tribunal with powers of investigation, conciliation and review. It would not deal with code of conduct matters or retail tenancy disputes. It would be based in a capital city using an existing federal court structure.
  • Option 4: Have a Small Business Advocate to operate within the Australian Government bureaucracy on behalf of small business. It would advise government on small business issues, including dispute resolution.
The purpose of the paper is to explore affordable dispute resolution options, but doesn't want to overlap with existing services.

Some other points include:
  • There is very little research done on business-to-business disputes, but cites some research undertaken in Victoria.
  • Small business has a low awareness of ADR (Alternative Dispute Resolution).
  • The Victorian Small Business Commissioner is cited as a good example. In 2008-09 it handled 1,362 mediations with a success rate of 80 per cent. It charges $195 per mediation.
Some interesting quotations from the paper:
  • "Service contracts between small businesses and larger firms are increasingly incorporating a dispute resolution clause that specifies the type and/or provider of ADR that must be utilised in the case of a dispute. In many instances, small business benefit from the guidance provided on dispute resolution. However, the nominated dispute resolution processes and/or providers may be too costly or inappropriate for a particular dispute."
  • "The New Zealand Disputes Tribunal aims to provide parties with "a quick, inexpensive, informal and private way to help resolve a wide range of civil disputes". The Tribunal makes binding decisions on matters where the claim is less than NZ$15,000 (approximately AUD$11,000).

    There are no judges or lawyers involved in the tribunal process, and decisions in matters are made by a referee. Lawyers can not attend a hearing, and application fees are low. The Disputes Tribunal has fifteen offices around New Zealand."
  • "Consult Australia developed through Standards Australia, a new Australian Standard 4122-2010 General Conditions of Contract for Consultants. The widespread adoption of this standard with fair and reasonable commercial terms will streamline the process of engagement of consultants, improve clarity and certainty of contractual terms and conditions between clients and consultants and ultimately reduce disputes between clients and consultants based on contractual terms."