I was amazed to learn of some regulations that were introduced in 2008 and how they can put small businesses at risk, if they don’t know about them. These regulations provide your customers with a minimum cooling off period of 7 days for most contracts entered into at their home or place of work.
Basically, the regulations apply to any contract made between a customer and a trader for the supply of goods or services, if it is made in the customer’s home or place of work. So if you regularly “sell” at the customer’s home you need to be aware of these regulations or you could end up not getting paid.
Once the deal has been struck you must give the customer a ‘Notice of Rights to Cancel’ in the correct format (email Simon if you want a copy). The customer then has 7 days to cancel the contract without recourse. If the customer would like the trader to start work within the 7 day cooling off period then they must sign a separate disclaimer to say so.
There are both civil and criminal (£5000 fine) penalties for failing to issue the notices. The civil penalties are more severe as the contract becomes legally unenforceable. This means that a customer could choose not to pay a trader for the work they have done and the trader cannot pursue the money through the courts. Any money already paid by the customer must be returned. So the trader could end up having paid out for the work to be done and then not get paid for any of it. The consumer effectively gets a free product or service. All because of one missing sheet of paper!
If you would like a copy of the Trading Standards leaflet on this subject please email Simon and he’ll email you one back. Please feel free to pass this article on to anyone you think may be affected by this.