2.5.2 Legislation Flashcards
Define legislation
laws and regulations passed by the government that require businesses and individuals to conduct their behavior in a particular manner
Why do we need legislation?
Without it some businesses neglect the needs of stakeholders
What are the 5 areas of legislation that have significant impacts on businesses?
-Consumer protection laws
-Employee protection laws
-Environmental protection laws
-Competition policy laws
-health and safety laws
What are consumer protection laws?
They aim to ensure customers are treated fairly by companies and they don’t mislead about products
What do consumer protection laws ensure?
-Product safety
-Product quality
-Product info is available
-Customers are treated fairly when unhappy
-Businesses cant gain unfair advantages over rivals
How can consumer protection laws impact businesses?
Meeting the consumer protection requirements can increase a businesses expenditure which may increase profitability
What are employee protection laws?
They aim to prevent the exploitation of workers.
They legislate for issues like pay, working conditions, discrimination against employees
What do employee protection laws aim to legislate for?
Issues like…
-pay
-working conditions
-discrimination against groups
-rights to be part of a trade union
-contracts and termination of employment
How can employee protection laws impact businesses?
Businesses may need to…
-Change working practices-> expensive
-Invest in safety equipment and give staff rest breaks –> high labor cost
-If laws are broken, may be fined
What are environmental protection laws?
Aim to hold businesses responsible for their environmental impact
What factors does the environmental protection laws govern?
-Pollution
-destruction to wildlife
-Traffic congestion
-resource depletion
-Air quality
How can the environmental protection laws impact a business?
Businesses that fail to adhere to the laws may be fined or forced go cease commercial activity
What are competition policy laws?
Aim to protect the interests of both consumers and businesses by restricting anti-competitive practices, cartel activity and abuse of market power
ensuring markets are fair placed to trade
Whats cartel activity?
Businesses working together to manipulate the market
How may competition policy laws impact a business?
If a business acted in an anti-competitive manner, authority may prevent a merger or instruct a business to dispose of subsidiaries (business controlling another business)
What are health and safety laws?
Require a business to operate in a way that protects employees and customers physical and mental wellbeing
What do health and safety laws include?
-rest breaks
-good temp and noise level
-provision of safety equipment
-hygienic conditions
-reduction of stress
How may health and safety laws impact a business?
The implementation or procedures and equipment to maintain healthy and safe business premises are likely to be expensive.
Staff training and changes to work hours is also expensive
What impact can legislation have on a business?
if businesses dont comply with legislation, legal action such as fines, restrictions and imprisonment can be actioned
