The Full Federal Court has unanimously upheld an appeal by the Australian Competition and Consumer Commission (ACCC), deciding that the Google Ads published by private company Employsure Pty Ltd (Employsure) were in breach of Australian Consumer Laws and misled consumers that it was, or was affiliated with, a government agency.
Facts
The Employsure Google Ads were published over 2 years between August 2016 and August 2018, and featured headlines such as: ‘Fair Work Ombudsman Help – Free 24/7 Employer Advice’ and ‘Fair Work Commission Advice – Free Employer Advice’. The Ads also appeared in response to search terms such as ‘fair work ombudsman’.
The ACCC has stated that it took this action after receiving over 100 complaints relating to Employsure, including from small businesses who had contacted Employsure after viewing a Google Ad and thought they were contacting the free workplace relations helpline operated by the government Fair Work Ombudsman.
Employsure is a private company that offers paid employment relations and workplace advisory services to business owners - it has no affiliation with any government agency.
The ACCC alleged that Employsure’s primary objective in targeting these businesses with Google Ads was to sign them up to long-term contracts with on-going fees. The original case brought by the ACCC also alleged that Employsure engaged in unconscionable conduct towards four small businesses, and that Employsure’s contracts contained unfair terms, including terms that made it difficult for small businesses to exit the long term contracts.
On 1 October 2020, the Federal Court judgement of Justice Griffiths dismissed this claim at first instance. The ACCC appealed that decision.
Decision
The Full Court of the Federal Court overturned the original judgement of Justice Griffiths, finding that:
- Employsure breached Australian Consumer Laws by making misleading representations that it was, or was affiliated with, a government agency, and
- Employsure’s Google Ads were misleading largely due to their use of government agency names in the largest and most prominent typeface, and because the ads did not have any reference at all to Employsure.
ACCC Deputy Chair Mick Keogh commented that:
“Employsure’s ads were displayed to small businesses who were searching for workplace relations advice from the relevant government agency, the Fair Work Ombudsman. Employsure is a private company which is not affiliated with the government, and provides workplace relations advice to businesses under long-term contracts with on-going fees,”
“We brought this case because we were concerned that Employsure’s ads gave the impression that Employsure was a government agency or affiliated with government. Any attempt to misrepresent a business as being part of the government is a serious breach of trust.”
A hearing on penalties will be held at a later date.
Key lesson for business
This decision by the Full Federal Court is an important reminder to businesses and individuals undertaking internet advertising that Australian Consumer Laws must be complied with and are there to protect both individuals and businesses. Misleading or deceiving consumers and small businesses when advertising by using words and phrases that are the same or similar to government agencies or other misleading statements to attract customers risks ACCC enforcement action, reputational damage and significant penalties.
Source: 13 August 2021
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