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McLEAN AND CO.
Festive Season Wishes
Public Holiday Pay for Employees
Fair Holiday Trading
FESTIVE SEASON WISHES
To all our clients and readers we wish you you a happy Christmas and a safe and prosperous New Year, both in business and personally. We look forward to working with you in 2014.
The Office will be closed for the followingperiod:
Wednesday January 01/01/2014- Monday 13/1/2014
ENTERTAINMENT COST CLAIMS RELATING TO GIFT BASKETS GIVENQuestions arise this time of year as to the application of 50% Entertainment Tax in certain instances.
If you give gift baskets containing food and drink to clients the cost will be 100% deductible, unless you eat or drink some of the contents which will limit the deduction to 50%.
If you give the same gift to staff the same applies but you will have to consider whether Fringe Benefit should be paid.
December has arrived and your employees may be entitled to public holiday pay over the Christmas and New Year period. It’s important to understand your obligations as an employer at this time of year.
Your employees are allowed a paid day off work on a public holiday if that day would usually be a working day.
Public holidays 2013/2014:
These four public holidays are separate from annual holidays.
Some small businesses require their employees to work on public holidays. If this is the case, they’re entitled to be paid time and a half for the hours worked and to receive a full day’s alternative holiday. You should put in writing an agreement with the employee to transfer the holiday to another day.
If your employee is sick and can’t work on your agreed day, you’ll need to pay them as if they had a paid, unworked public holiday.
For most employers, the working week doesn’t vary which makes it easy for you and your employees to agree to whether the public holiday dates are usual working days or not. If you can’t come to an agreement, consider:
For more information on managing your staff and leave entitlements read this guide to holidays and entitlements.
FAIR HOLIDAY TRADING
If you are a retailer or service based business gearing up for a bumper Christmas season, now’s a great time to polish up on your knowledge of your responsibilities under the Fair Trading and Consumer Guarantees Acts.
Both Acts affect the way that you can legally advertise and sell your products – from running Christmas sales and promotions to resolving customer returns and disputes.
The Fair Trading Act (FTA) covers all aspects of the promotion and sale of goods and services, and this includes pricing. The key point to remember is that all claims your business makes about price must be clear and accurate.
In the mind of your customer, the word ‘sale’ means an opportunity to buy goods at reduced prices for a limited time.
There are many different types of sales, but all generally imply that a lower price than usual is being charged. Any goods or services a business promotes as part of a sale must be priced below normal levels to avoid misleading customers. If a sale doesn’t include stock already on sale or discounted, then this must be clearly stated.
The Consumer Guarantees Act (CGA) protects customers from poor quality services and goods that do not meet reasonable customer expectations.
The CGA applies to all goods bought for personal or household use – such as clothes, food, appliances, and furniture. Vehicles, pets, plants and trees, and second-hand goods are also covered as well as goods sold by hire purchase or hired out for use.
The Act also applies when you buy these types of household goods to use in your business – such as a toaster for the staff cafeteria – unless the seller’s contract, or its terms and conditions, specifically exclude goods bought for business purposes.
If you sell or buy goods that are not normally bought for household use these aren’t covered by the CGA – such as a hardware store selling tools to professional tradespeople. These goods aren’t covered even if they are purchased by a consumer for household use.
If the problem with the goods can be fixed, then your customer can ask you to put it right. You must provide a remedy, but you do have the choice of whether you will repair the goods, replace the goods or give a refund.
You must act within a reasonable time and provide the repair or replacement free of charge.
You don’t have to give a refund or a replacement if the customer has decided they no longer want the goods or if their circumstances have changed. It’s your choice whether you offer a refund or any other remedy if a customer has changed their mind or decided they can't afford the goods.
However, if you told the consumer that they could get a refund or a credit note if they change their mind, then that is part of your contract with them.
When a customer changes their mind about goods they are paying off on layby they have the right to a refund under the Layby Sales Act.
You will not be liable for a fault if you display a sign or tag with the goods that specifically states what the fault is – for example, "this appliance has a scratch on the left side".
You can only exclude liability for specific faults that you know exist. You can’t use a sign to avoid responsibility for unknown faults that may occur.
The CGA says that any consumer service you provide must meet four specific guarantees.
These guarantees are:
Guarantee of reasonable skill and care:
Reasonable care and skill will be judged by looking at the care and skill used by other competent people doing the same work. Your skills should be such that you can do the job and achieve the purpose the customer wanted. You should take the same care that other competent people take to do the job well and avoid causing any damage.
Some examples of a lack of skill and care include:
You can find out more about The Consumer Guarantees Act and Fair Trading Act by visiting Business.govt.nz’s Consumer Laws section.
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