Age is the greatest barrier to opportunities at work, according to findings in LinkedIn’s 2020 Opportunity Index. The report sought to understand how people perceive employment opportunities and the gaps in achieving those opportunities. Baby Boomers are the most likely to perceive age as a barrier, with almost half of Baby Boomers concerned about age, followed Read More…
SMEs are paying more than $130k to resolve disputes
Thu 6 December 2018 - 7:00 pmNews
According to new research small businesses in Australia are paying more than $130,000 to resolve a dispute through formal pathways. This is double the cost of a decade ago.
Releasing the results of the Access to Justice Inquiry (Phase I) research, the Australian Small Business and Family Enterprise Ombudsman, Kate Carnell said payment times and terms remain the biggest cause of disputes.
“We surveyed 1,600 small businesses across Australia and found time and cost are the most significant factors when determining how far to pursue resolution of a dispute,” Carnell said.
“Our research shows 22% of small businesses surveyed had been involved in a serious dispute in the last five years. Nine out of 10 were business-to-business disputes and one in 20 were business-to-government.
“Three out of five sought legal advice from a lawyer. At this point, the small business owner has to decide whether to pursue the dispute, as the expected costs of further action most often outweigh the potential gain. Half of those surveyed considered the amount of time and effort required was unreasonable.
- Over one in ten (11%) of small businesses in Australia decided against escalating a dispute through a formal mechanism because they were unable to afford the costs involved.
- The most common cause of disputes (44%) related to payment issues. In the Mining sector, over 70% of disputes related to refusal to pay the full amount charged.
- Payment times remain the biggest cause of disputes (44%)
“The system is stacked against the small guy. The costs of dispute resolution, whether legal or by alternative means, are prohibitive to small businesses. Most industries are totally unregulated and don’t offer consumers the opportunity to hold their suppliers or customers to account,” said Yanir Yakutiel, founder and CEO of small business lender, Lumi.
“It would be good to see more industries should adopt mandatory dispute resolution mechanisms that are enforceable on the relevant parties. The SME lenders have recently launched a code of conduct that gives customers access to external dispute resolution system.
“For small businesses, it’s important to be able to get application outcomes fast when applying for a loan. Again, the main issue here is cash flow. Business owners are focused on running and growing their business, what ever that may be.”
- February 17 2020 Telstra and Rio Tinto move to 20 day payment terms for small businesses
- February 13 2020 Fintech company ezyCollect raises $7.1 million investment over 15 months
- February 12 2020 Salary increases shrink nationally despite increase in pay rise requests
- February 11 2020 Neobank growth in Aus ‘a little terrifying’