ACCC ruling to pave way for collective bargaining by small businesses

collective bargaining

The Australian Competition and Consumer Commission (ACCC) has issued a new ruling that will allow small businesses to enter into collective bargaining without them having to worry about possibly breaching competition laws.

The ACCC ruled that collective bargaining entered by businesses with an annual turnover of less than $10 million per year shall will under a class exemption, which entails legal protection from competition laws that usually take effect during the commencement of such activities.

Previously, the ACCC only allowed collective bargaining on a case-by-case basis, but with the ruling that took effect on 3 June, small-business groups choosing to engage in collective bargaining simply need to provide a one-page notice to the regulator with no charges to be incurred.

The Australian Small Business and Family Enterprise Ombudsman Bruce Billson welcomed the ruling, saying that it significantly strengthens the negotiating position of small businesses.

“Collective bargaining is a potential game-changer for small businesses as it boosts their purchasing power and mitigates the risk of predatory tactics sometimes used by larger companies to financially squeeze their small suppliers,” Bilson said.

“It also saves time and money for small businesses in contract negotiations, as they can share the cost and resources. In addition…the new provisions better accommodate the dynamic pace of the small business economy by allowing participants to enter and exit the group without the need for a new approval,” Bilson added.

“It’s an initiative that will help small businesses remain competitive and viable, at a time when it is needed the most,” the Ombudsman concluded.