2.5.2 Legislation

Question 1

Legislation

Answer 1

A set of rules and regulations with which a business has to comply

Question 2

Consumer protection

Answer 2

Aims ensure that consumers are treated fairly by companies.

Ensures that:
- Products should be fit for purpose.
- Products should be of a satisfactory quality.
- Products should match its description.

Supply of goods act.
Trade Descriptions Act.
Distance Selling Regulations.
Weights and Measures.

Question 3

Impact of failing to follow consumer protection laws

Answer 3

• Damage reputation.
• Poor customer loyalty.
• Potential legal actions.
• Returns/refunds.
• Other businesses gain an advantage.

Question 4

Employee protection

Answer 4

Prevents the exploitation of workers.

Includes:
- Minimum wage.
- Holiday pay.
- Equality of employment rights for marginalised groups to avoid discrimination.
- The right to belong to a trade union and take industrial action.
- Contracts and termination of employment.
- Redundancy.
- Increased right to sick, maternity and paternity leave.

Equality Act 2010
National Minimum Wage Act 1998
National Living Wage

Question 5

Impact of Employee Protection laws

Answer 5

+ Potential rewards.

• Higher Labour costs.
• Potential penalties.
• Changing working practices.

Question 6

Environment Protection

Answer 6

Aims to hold businesses responsible for their environmental impact.

Includes:
- Pollution.
- Destruction of wildlife.
- Traffic congestion.
- Air quality
- Resource depletion.

The Environment Act 1995.

Question 7

Competition Policy

Answer 7

Aims to protect the interests of both consumers and businesses by restricting anti-competitive practices such as:

• Anti-competitive mergers and acquisitions.
• Cartel activity - businesses working together to manipulate the market and limit competition by controlling supply and prices.
• Abuse of market power e.g. imposing unfair conditions on small suppliers.

CMA (Competition and Markets Authority) - Tackle anti-competitive activities to ensure fair trading conditions.

Competition Act 1998

Question 8

Health and Safety

Answer 8

Requires a business to operate in a way that protects the physical and mental wellbeing of its employees and customers.

• Providing adequate breaks and rests.
• Temperature and noise levels.
• Providing safety equipment.
• Preventing stress.
• Hygienic, safe and sanitary conditions.

Question 9

Impact of Health and Safety laws on businesses

Answer 9

Requires time and money.

• Staff training and supervision.
• Changes to working hours and rests.
• Purchase of safety equipment.
• Arrangement of safety documentation and signage.

Question 10

3 types of markets

Answer 10

Monopoly = Dominant business, owns more than 25% of the market, high barriers to entry.
Oligopoly = Few dominant businesses, high barriers to entry.
Perfect competition = Low barriers to entry, fair.