When you pay for a service you expect to get what you paid for. So what are your rights when something goes wrong?
Just as it does for products, the Australian Consumer Law (ACL) covers you when you're buying a service, including bundled services like a pay TV plan which includes equipment.
The ACL creates consumer guarantees, which automatically protect Australian shoppers, giving you the rights you expect. Businesses must provide these guarantees even if they also give or sell you other warranties.
According to the consumer guarantees, services must:
be performed with proper care and skill
be fit for a particular purpose or achieve a result agreed between the supplier and the consumer
be delivered within a reasonable time or by the end date set in the contract.
How do I get the consumer guarantees?
You don't have to do anything. Consumer guarantees automatically apply if you paid for services after 1 January 2011:
that cost less than $40,000
that cost more than $40,000, but they're normally used for personal, domestic or household purposes.
But you won't get the consumer guarantees if you:
bought services before 1 January 2011 (these are covered by different laws)
simply changed your mind or saw the service cheaper somewhere else.
And consumer guarantees don't apply to insurance and financial services or to transporting and storage of goods for business purposes.
How the guarantees apply to services
What does "due care and skill" mean?
Suppliers have to carry out services with what is called "due care and skill". This means that they have to use an acceptable level of skill or technical knowledge and they must take care to avoid loss or damage. For example, a landscaper is called in to repair a fishpond which has developed some cracks and leaks. He fixes the cracks but instead of checking whether the waterproof paint he has in his truck is suitable, he goes ahead and uses it to paint the fishpond without noticing that it is toxic to fish. Obviously, there is a lack of due care and skill by the landscaper. Luckily his customer discovers this before putting her very expensive exotic fish in the pond. Otherwise there might be a claim for compensation too.
Fit for purpose
Services must be reasonably fit for a particular purpose or to achieve a result that has been agreed between the supplier and the consumer. If you order a glass pool fence to be built around your new swimming pool, but once completed it doesn't meet the legal requirements for pool fences – the gaps between the panels are too wide and the glass isn't thick enough – then the fence isn't fit for its purpose.
Services also have to be provided within a reasonable time or by the finish date stated in the contract. What is reasonable will depend on the type of service that is being performed and other factors such as the availability of parts or the weather. For example, you engage a mechanic to repair your car, but no time period is agreed. Three weeks later the car is still sitting in the mechanic's garage. If it's just a straightforward repair and there's no particular problem with getting spare parts, the services have probably not been provided in a reasonable time. But if the mechanic is waiting on a special part to arrive from overseas, or the car is an unusual car with special requirements, the delay might be reasonable.
Failure to meet the guarantees
You have a few options available if the services you've paid for don't meet a consumer guarantee. It all comes down to whether the services have suffered from a major or a minor failure.
Major failures in services are those that can't be fixed or are too difficult to fix. The 'tests' are:
You would not have paid for the service had you known about the problem. For example, you pay for replacement keys to be cut for your house but they are cut so poorly that they don't open your front door.
- The service is substantially unfit for its usual purpose (and can't be fixed in a reasonable period of time). For example, you engage a gardener to look after your lawn while you're on holidays, but he puts weed killer on the grass instead of fertiliser.
- You told the supplier about the particular purpose the service was required for and it hasn't met that purpose (and can't be fixed in a reasonable period of time). For example, you pay for a photographer to take photos at your grandmother's 80th birthday party, but the photographer gets the date wrong and doesn't turn up.
- You told the supplier that the service needed to achieve a certain result and the service hasn't met that result and can't be fixed in a reasonable period of time. For example, you engage a carpenter to build a carport and tell him you'll be parking your 4WD car in it. He doesn't take the measurements properly and your 4WD doesn't fit.
- The supply of the service has resulted in an unsafe situation. For example, you engage another builder to build your carport to the correct height, but she doesn't use the right beams and the roof starts to buckle in the middle.
If there's a major failure in a service you can choose to:
cancel the contract and pay a reasonable amount for the work done or ask for a refund for the money already paid
- keep the contract and negotiate a reduced price.
A minor failure is something that can be fixed in a reasonable period of time. The service provider can offer you a refund or a re-supply of the service. These must be provided free of charge. If they refuse to fix the problem or take too long you can ask someone else to fix it and ask for compensation.
Cancelling a service
You can't cancel a service if there's a minor failure or if it can be reasonably fixed. But you can cancel a service if there's a major failure. You should notify the service provider in person or by phoning or writing to them. You might also be able to ask for a refund for some money paid. This will depend on the circumstances of the failure of the service and you will need to negotiate this with the service provider.
Where services have failed to meet a consumer guarantee, you might be able to claim compensation. The damages must be reasonably related to the failure to meet the consumer guarantee. This means that a business won't have to pay for damages that are not caused by their conduct.
To make a claim for compensation you should work out an amount which would put you in the same financial position you were in before the breach of guarantee. You should have as much information available as possible to support your claim.
Many retailers display misleading signs about refunds. They try to make consumers believe that they're not responsible for any damage in any situation, even if there is a major failure. Here are some examples of signs that don't comply with the Australian Consumer Law:
No refunds after 14 days.
Exchange or credit note only.
But signs that tell consumers there are no refunds for change of mind are OK.
Service providers can't rely on signs that imply they have no responsibility for bad work, such as:
Goods left for repair at your own risk.
All care but no responsibility.
What can I do?
As soon as you notice a problem with your service you should contact the service provider to let them know. Work out whether you think it's a major problem or a minor problem and think about what you would like to happen before contacting the business.
Remember, for a minor failure the business can offer to fix the problem, or give you a refund or re-supply the service. For a major failure, you can cancel the service or negotiate a reduced price.
Try phoning first – sometimes a quick phone call is all that is needed. If the person you speak to is not helpful, ask to speak with a manager or the business owner. You might need to use some key phrases to get your point across, such as:
Australian Consumer Law
fit for purpose
refund or repair or replace
Write notes of your conversations so you can refer to them later if you need to, including dates and names of people you speak with.
If a phone call is not enough you might have to follow up with an email or letter or a visit. Be clear. Say what is wrong and what you want to happen. Give them a reasonable time to respond and keep copies of any correspondence.
What if I can't get any response?
If you can't get the right response from the service provider, try contacting the ACCC or your state or territory fair trading or consumer protection office – contact details are here.
Sometimes it's necessary to take action in courts or tribunals. You will need legal advice if you want to do this as it can be very expensive and cases can take unexpected turns.
For more help with your consumer rights, go to choice.com.au/choicehelp.
Our CHOICE Help service is free to members, helping you stand up for your rights when things go wrong.