Retail warranty rort


85% of major electronics retailers have a lot to learn about consumer law.

A CHOICE shadow shop of 80 Harvey Norman, The Good Guys and JB Hi-Fi stores across every state and territory in Australia during three weeks in September and October found widespread violations of the Australian Consumer Law (ACL).

When asked about returning big ticket items, 85% of sales staff at Australia’s biggest electronics retailers had limited or no understanding of their obligations under the ACL. Either that or the many salespeople CHOICE spoke to wilfully flouted the consumer protections that came into effect in 2011.

“The advice given by major electronics retailers flies in the face of the ACL. The fact that 85% of sales staff got it wrong and 100% offered an extended warranty is very concerning. Consumers need to be wary of warranty advice they are given in-store,” says CHOICE spokesperson Tom Godfrey.

“Consumers should not be fooled into purchasing extended warranties they don’t need and we’d like to see the ACCC and fair trading bodies investigate these breaches.”

Two CHOICE journalists posed as customers looking for a big screen TV for around $2500, and asked salespeople if the store had any responsibility should the TV cease to function after the manufacturer’s one-year warranty period.

Under ACL, the correct answer is yes. Unfortunately, the overwhelming response from salespeople was that repair and returns would be out of the store’s hands.

CHOICE contacted the corporate headquarters for Harvey Norman and JB Hi-Fi and found that both companies understood the principles behind the ACL, despite what we heard from their salespeople. Both agreed a customer should expect a refund, even if a product care or extended warranty had not been purchased.

The Good Guys declined to answer CHOICE’s questions about customer rights outside of the manufacturer’s warranty.

2011 legislation says consumers have a right to refund, repair or replacement through the store for a reasonable time after purchase. The time period within which a good should be of acceptable quality depends on factors like the type of good and price of the item.

“A follow-up ACL guideline released in 2013 is crystal clear on what a retailer’s responsibility is when it comes to expensive electronics. If you have any doubts around advice provided in-store, consult the guide.”

CHOICE talked to the ACCC which confirmed that leading customers to believe they wouldn’t be able to take a pricey TV that’s out of warranty back to the store is a breach of consumer law.

CHOICE tips for right to refund

  • If a product is not of acceptable quality the retailer can’t charge you for fixing it.
  • Retailers can’t just refer you to the manufacturer. They’re obliged to resolve your issue.
  • If the problem is ‘major’, you can ask for a refund or replacement rather than a repair.
  • You should be informed if a replacement is second-hand or if they’ve used refurbished parts to repair it.
  • Repairs must be made within a reasonable time. Mobile phones and fridges, for instance, must be given high priority, or you can demand a replacement.
  • You don’t have to return a product in its original packaging, and if you’ve lost your receipt you can use the following as proof of purchase:
    • a credit card statement that itemises goods
    • a confirmation or receipt number for a phone or internet transaction
    • a warranty card showing the date, price and place of purchase; or the serial or production number if it’s stored on the retailer’s computer

Media Contact:
Tom Godfrey - 0430 172 669

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