External influences - legislation Flashcards
What are some external legal influences that impact businesses?
- Employment law
- health and safety
- consumer protection
- taxation (corporate and consumer)
- minimum wage and pensions
- advertising standards
- other regulations
How are businesses impacted by employment law?
- forces businesses to not be impartial in recruitment process
- sick pay
- equal pay
- redundancy rights
- gives employees the right to a trade union
- forced pensions
- must adhere to legislation provided for hours per week
- can be more costly if businesses have to change parts of their organisation
- clear contingency plans for employees welfare
How are businesses impacted by health and safety?
- must be careful and trained intensely to reduce the chance of incidents which can lead to negative PR and law suits
- may deter potential employees from joining
- carry out risk assessments regularly
- Have to make a health and safety policy
- insurance?
- have to maintain a healthy work environment that recognises the demand of employees
How are businesses impacted by consumer protection?
- Cannot mislead customers
- have to assure quality throughout businesses (circles, assurance or controls)
- understand what customers expect (compare with competition and trends)
- Have clear corporate objectives that are mandatory
- Trade descriptions act
- Weight and measures act
- Sales of good act
- Consumer credit act
- good customer service and reliable refund policies
How are businesses impacted by taxation?
- Force customers to carry burden from production (higher cost)
- reduced profits
- legal requirement that must be met if not = PR
- Global diseconomies of scale if a business has differing taxes in various countries
- Luxury products won’t be purchased
How are businesses impacted by minimum wage and pensions?
- Businesses have to complete market research to understand the level of pay which acceptable
- legal requirement
- makes a business make a contingency plan
How are businesses impacted by the advertising standards?
- Have to keep in the regulation by the ASA
- Forces businesses to be sensible with the adverts created and the message
- Can be positive or negative
What is the ASA?
Advertising standards agency, they are an authoritative organisation that have standardised what is acceptable in an advert.
What are the acts that businesses have to abide by?
- Weight and measures act
- Sales of good act
- Trade descriptions act
- Consumer credit act
- Food and drugs act
What is the weight and measures act?
that the products sold by a business is accurate
What is the sales of good act?
states that the good must be satisfactory quality
What is the trade descriptions act?
goods and services must perform how displayed
What is the consumer credit act?
the protection of customers when borrowing money or buying on credit. This basically shows the customer when the installments will be and how much.
What is the food and drugs act?
Makes sure that the food and drugs are safe
What are some other regulations that impact businesses?
- maternity and paternity rights
- security and environmental requirements
- information and privacy
