Ananda Lawyers will have to make more than $3 million a year to recover their legal costs after the Federal Government scrapped a law designed to protect people against unfair business practices.
Key points:Ananda Lawyers says the law, which was introduced in March, was designed to prevent business practices that cost more than their marginal costs, such as “underwriting” a home for a family member or “subsidy” for an out-of-work employeeAnanda said the law was a “fundamental” part of its business modelThe company says the policy will cost it more than it could recover from consumersUnder the law a company must prove to a court that it was unfair to charge a higher price to a person who had a higher marginal cost than the company’s own.
It means that Ananda’s lawyers will have no option but to make substantial legal expenses to recover costs for which they are not entitled under the law.
“The new law will significantly increase the burden of Ananda lawyers and other legal providers on the Australian taxpayer in relation to their costs of defending in the court,” Ananda said in a statement.
“It will be a burden not only on Ananda and its employees but also on consumers and taxpayers.”
In the long run, these costs will inevitably increase as a result of the changes to the Fair Work Act.
“The policy change was introduced to stop businesses using “underwrite” to provide a lower marginal cost to a business.
Under the Fair Care Act, companies must pay the cost of the services provided to a family or household member or employee.
Ananda is the only company in the country that has a business model based on providing a cheaper alternative to an employee, as it says this is what its customers are paying for.”
Ananda will continue to seek the advice of its legal counsel and the Competition and Consumer Commission before making any decisions on any future actions,” it said.
Anancy’s chief executive David Denton said it was “disappointed” that the government was “taking away from Ananda the ability to ensure that we are delivering a fair and competitive fair market” for people.”
A change in the Fair Health and Fair Work Acts was made to prevent a loophole that allowed some of the most abusive business practices to continue,” he said.”
This law was introduced with the aim of protecting consumers from unfair business practice and we will continue fighting to stop it.
“For Ananda, the changes have created significant financial risk as the company will have been forced to make significant legal expenses and be unable to access its customers’ funds.”
The new Fair Work Bill will make it easier for Ananda to recover legal costs under the Fair Housing Act, Fair Work, Workers Compensation and Disability Insurance.
“We are confident that we will prevail in the Federal Court against the Government and we look forward to being able to bring this important issue to a successful conclusion in the High Court,” Mr Denton added.
Anandaholic said it would also be forced to “fight for its future” and would continue to invest in its business.
The new legislation will also give Ananda more flexibility to manage its workforce, with the number of employees being reduced from 25 to 20, with a focus on increasing training and increasing the number in Australia.
Topics:business-economics-and-finance,law-crime-and‑justice,courts-and/orrettes,community-and_society,business-administration,horticulture,health,health-administrator-general,workers,healthcare-facilities,employment,employment-and-$45,government-and—politics,act,sydney-2000,nsw,australiaFirst posted February 06, 2019 14:17:20Contact Josh MacdonaldMore stories from New South Wales