The laws that govern how businesses treat employees, customers and competitors
⚖️ Employment law🛡️ Consumer protection⏱ 18 min📝 3 practice questions
Learning Objectives
By the end of this lesson you will be able to…
Explain why legislation exists and how it constrains business behaviour
Describe key employment laws and their impact on businesses
Explain how consumer law protects buyers
Outline competition law and why monopolies are regulated
Describe health & safety and data protection obligations
The Purpose of Law
Why Does Business Legislation Exist?
Key Idea
Legislation creates a level playing field and protects stakeholders who would otherwise have less power — employees, consumers, and communities — from unfair or harmful business behaviour.
Who it protects
Employees — from exploitation and unsafe conditions
Consumers — from fraud, dangerous products and mis-selling
Competitors — from anti-competitive practices
Community — from environmental harm
Personal data — from misuse
Cost to business
Compliance costs time and money
Minimum wages raise labour costs
Health & safety investment is required
Data systems must meet GDPR standards
Fines for non-compliance can be severe
Employment Law
Key Employment Legislation
National Minimum Wage / National Living Wage
Businesses must pay at least the legal minimum. The National Living Wage (for 21+) is higher. Increases labour costs but improves employee wellbeing and spending power.
Equality Act 2010
Prohibits discrimination based on protected characteristics: age, sex, race, disability, religion, pregnancy and others. Applies to hiring, pay, promotion and dismissal.
Working Time Regulations 1998
Workers cannot be required to work more than 48 hours per week (averaged) without opting out. Minimum paid holiday of 28 days per year for full-time workers.
Employment Rights Act 1996
Provides rights including written employment contracts, protection from unfair dismissal (after 2 years), and statutory redundancy pay.
Consumer Protection
Consumer Legislation
Consumer Rights Act 2015
Goods must be of satisfactory quality, fit for purpose, and as described. Consumers have the right to a refund, repair or replacement for faulty goods. Also covers digital products and services.
Consumer Protection from Unfair Trading Regulations 2008
Prohibits misleading advertising and unfair commercial practices. Businesses cannot make false claims about their products or pressure consumers into buying.
Trading Standards
Local authorities enforce consumer protection laws, investigate complaints about mis-selling, counterfeit goods, and unsafe products.
Exam tip: The Consumer Rights Act is the most commonly tested consumer law — know the three remedies: refund, repair, replacement.
Competition Law
Competition & Data Protection Law
Competition Act 1998 / CMA
Competition and Markets Authority (CMA) regulates markets
Prevents anti-competitive mergers that would create monopolies
Bans price-fixing agreements between rivals
Ensures consumers benefit from competitive pricing
Can fine businesses up to 10% of global turnover
GDPR / Data Protection Act 2018
Businesses must state how they use personal data
Data must be stored securely
Customers can request their data be deleted
Consent must be given for marketing emails
Fines up to €20m or 4% of global turnover for breaches
Health & Safety
Health & Safety Legislation
Health and Safety at Work Act 1974
Employers have a legal duty to ensure the health, safety and welfare of all employees — as far as is reasonably practicable.
Employer duties
Provide a safe working environment
Train employees in health and safety
Provide necessary protective equipment (PPE)
Conduct risk assessments
Report serious workplace accidents (RIDDOR)
Consequences of non-compliance
Heavy fines from the Health and Safety Executive (HSE)
Criminal prosecution of managers
Compensation claims from injured workers
Reputational damage and loss of trust
Temporary or permanent closure of premises
Evaluation
Overall Impact of Legislation on Business
Benefits for businesses
Clearer rules create a stable operating environment
Employment law improves staff morale and retention
Consumer protection builds customer trust
Competition law prevents dominant rivals from crushing small firms
Costs for businesses
Compliance costs reduce profit margins
HR and legal departments needed to ensure compliance
Minimum wage rises increase labour costs
GDPR requires investment in data systems and staff training
Key evaluation: Legislation often benefits workers and consumers at a cost to business profitability — but businesses that comply also build long-term reputation and avoid costly penalties.
Practice Question 1 of 3
A customer buys a laptop that stops working after 2 weeks. Under the Consumer Rights Act 2015, what is the customer entitled to?
ANothing — electronics carry an "as is" warranty
BA refund, repair or replacement as the goods are not of satisfactory quality
CA voucher for the same store only
DA free extended warranty but no refund
Correct: B. Under the Consumer Rights Act 2015, goods must be of satisfactory quality, fit for purpose and as described. A laptop failing after 2 weeks is not of satisfactory quality. The customer is entitled to a full refund within 30 days; after 30 days they can request a repair or replacement first.
Practice Question 2 of 3
A business pays its 22-year-old workers £7.00/hour, below the National Living Wage. Which law has it broken?
AConsumer Rights Act 2015
BCompetition Act 1998
CNational Minimum Wage Act / National Living Wage legislation
DHealth and Safety at Work Act 1974
Correct: C. The National Living Wage applies to workers aged 21+. Paying below this rate is illegal and can result in fines, back pay claims, and reputational damage. The Consumer Rights Act protects buyers, the Competition Act covers market fairness, and H&S covers workplace safety — none of these apply here.
Practice Question 3 of 3
Two competing supermarkets secretly agree to charge the same price for bread to avoid competing on price. Which law have they broken?
AHealth and Safety at Work Act 1974
BConsumer Rights Act 2015
CCompetition Act 1998 — price-fixing is illegal
DData Protection Act 2018
Correct: C. Secretly agreeing on prices with competitors is called price-fixing and is illegal under the Competition Act 1998. It harms consumers by eliminating price competition. The Competition and Markets Authority (CMA) can fine businesses up to 10% of global turnover for this type of cartel behaviour.
Key Takeaways
What to Remember
Employment law — Minimum Wage, Equality Act, Working Time Regulations protect employees from exploitation
Consumer Rights Act 2015 — goods must be satisfactory quality, fit for purpose; refund/repair/replacement rights
Competition law — the CMA prevents monopolies and price-fixing to protect competitive markets
Health & Safety at Work Act — employers must maintain safe workplaces or face fines and prosecution
GDPR — businesses must protect personal data; fines for breaches can be enormous