42. Legislation Flashcards
The need for legislation in business
Without legislation it is possible that some businesses could neglect the needs of certain stakeholders.
Consumer issues influenced by legislation:
- Product quality
- Product safety
- Prices and payment methods
- Consumer rights
- Promotion and advertising
- Trading and age restrictions
How does consumer legislation affect businesses?
- Increase in costs
- Quality control
- Dealing with customer complaints
- Changes in business practice
Employee protection:
- Employment contract
- Discrimination
- Unfair dismissal
- Equal pay
How does employment legislation affects businesses?
- Compilance costs
- Higher labour costs
- Changing working practices
- Loss of flexibility
- Penalties
- Postive effect
Environmental protection:
- Pollution
- Destruction of wildlife habitats
- Traffic congestion
- Resource deplation
How does environmental legislation affects businesses?
- Marketing (environmental issues can be a highly effective marketing tool for some businesses)
- Finance (responding to environmental concerns or new laws and regulations can have a positive financial impact on a business such as energy saving)
- Operations management (can impact on how a product is made such as material used)
- Human resources (staff will need to be recruited and trained to deal with ever increasing government regulations concerning the environment, it is a way of motivating staff and attract employees)
Competition policy
- Increasing prices (raising prices to levels above what they would be in a competitive market)
- Restricting consumer choice (a manufacturer of a strong brand might refuse to supply a retailer if that retailer stocks rival products)
- Raising barriers to entry (by spending huge amounts of money on advertising a dominant firm can squeeze others out of the market)
- Market sharing (this might occur if there is collusion, when a market is shared out between the dominant firms, choice is restricted and prices rise)
Responsabilities of the competitions and markets authority for protecting consumers from restrictive practices:
- Investigating margers which could restrict competition
- Conducting market studies and investigations in markets where there may be competition and consumer problems
- Investigating wher UK or EU laws against anti-competitive agreements and abuses of dominant positions mat have been broken
- Bringing legal action against individuals who commit the cartel offence
- Enforcing consumer protection legislation to tackle practices and market conditions that make it difficult for consumers to exercise choice
- Co-operating with sector regulators and encouraging them to use thei competition powers
- Considering regulatory references and appeals
How does competition policy affect businesses:
- Positive: As competition policy is designed to promote competition, many firms will actually benefit from it and it will give opportunities to more businesses
- Negative: Some businesses might argue that competition policy restricts their activites as this could cause delays and cost the business involved a lot of money
Health and safety:
- Providing and maintaning adequate safety equipment and protective clothing, such as fire extinguishers, aprons, hard hats, ear plugs and safety googles
- Ensuring workers have enough space to do their jobs
- Guaranteeing a hygienic environment with adequate toilet and washing facilities
- Maintaining workplace temperatures and reasonable noise levels
- Providing protection from hazardous substances
- Providing protection from violence, bullying, threats and stress in the workplace
- Providing adequate breaks for rest
How does health and safety legislation affect businesses:
- Penalties (failure to comply with the law can be serious as employees safety might be compromised)
- benefits (a good health and safety record will help to improve the image of a business, this will make it easier to attract and retain high-quality staff)
Intellectual property rights:
- Automatic protection (the creator is automatically entitled to copyright protection)
- Applying for protection (it is necessary to apply for protection, it is necessary to check first to see whether a trademark already exists)
Intellectual property can be owned if:
- It is created ( and it meats the requirements for copyright, a patent or a design)
- The intellectual property rights are purchased from the creator or a previous owner
- You have a brand that could be a trademark
How do intellectual properties rights affect business
If businesses and people can protect their original work from theft, creativity is likely to be encouraged. In the wider economy everyone benefits from the work done by businesses to develop new products and new technology because they can enjoy more choice and lower prices
