Operating an NDIS business includes the responsibility of complying with the Australian Consumer Law and the regulatory enforcement and compliance requirements of the National Disability Insurance Scheme. Consumer laws are designed to protect the rights of consumers and ensure fair, ethical, and transparent practices.
For NDIS businesses, compliance is particularly important, as participants often rely on critical supports and services to achieve their goals and maintain their quality of life. By understanding and complying with their legal obligations, NDIS businesses can build trust with participants, avoid disputes, and safeguard their reputation while contributing to a fair and supportive NDIS marketplace.
Background
In November 2024, the Australian Competition and Consumer Commission (ACCC) put businesses on notice about concerns in relation to false or misleading advertising practices targeting NDIS participants. The ongoing investigations by the ACCC into multiple NDIS providers concerning false or misleading advertising practices highlight the legal implications these providers may face for breaching consumer laws. This is not the first time providers have been reminded of their obligations; on 22 January 2021, the NDIS Commission sent a letter to registered providers reminding them of their obligations under Consumer Law.
Current Court Proceedings
The ACCC has instituted proceedings in the Federal Court against a registered NDIS provider for alleged false or misleading advertising and representations relating to the sale of aged care and disability products.
The ACCC alleges that the provider made false or misleading representations to consumers relating to the usual price of products, the time limited nature of sales, and the savings consumers could achieve when purchasing products during one of the providers frequent sales.
The provider also allegedly made false or misleading statements that certain products were ‘NDIS approved’.
Your Legal Obligations
Under Australian Consumer Law, you are legally required to do the following:
- Treat your customers fairly
- Sell safe products
- Compete fairly.
Tips to Safeguard Your Business
1. Understand and Comply with Australian Consumer Law (ACL)
- Ensure all services and products meet the guarantees under the ACL, including being fit for purpose and provided with due care and skill. Both registered and unregistered NDIS providers must deliver safe and competent supports and services.
- Be transparent in pricing, service agreements, and policies to avoid misleading or deceptive conduct.
2. Maintain Clear and Honest Communication to Avoid Problematic Advertising Practices
- Provide accurate information about your services, fees, and terms. Registered NDIS providers must comply with registration conditions and the ACL to ensure transparency and avoid legal ramifications.
- Avoid making false claims or promises about outcomes.
3. Implement Fair Policies and Procedures
- Have clear refund, cancellation, and complaint-handling policies in place.
- Resolve disputes promptly and fairly to maintain trust and avoid ACCC intervention.
4. Train Your Team
- Ensure employees understand their responsibilities under ACL and how to provide services ethically and transparently.
- Provide ongoing training in customer service and compliance.
5. Monitor and Improve Practices
- Regularly review business practices to identify and address any potential risks of non-compliance.
- Use participant feedback to improve services and ensure satisfaction.
6. Stay Updated
- Follow ACCC guidance for businesses, particularly those working in regulated sectors like the NDIS.
- Keep informed about changes in consumer law or NDIS-specific regulations.
By prioritising compliance, transparency, and participant satisfaction, you can reduce risks and maintain a strong reputation while protecting your business under the oversight of the ACCC.
If You Think Your Business is at Risk:
Review Pricing to ensure “Fair Pricing”
Fair pricing is when there is no major price difference between the cost of a product or service for an NDIS participant compared to other customers.
If a provider sets a higher price for NDIS participants and cannot justify the price difference, they may be in breach of the Code of Conduct which now includes rules about price differentiation.
From the NDIS Provider and Workforce Registration Taskforce, it is recognised that pricing plays a significant role in driving quality and fairness within the marketplace. The Independent Health and Aged Care Pricing Authority (IHACPA) is undertaking initial work to reform the NDIS pricing data strategy and the Fair Pricing Taskforce, chaired by the ACCC.
Review all Advertising to ensure compliance with Australian Consumer Law
The ACCC is working with the National Disability Insurance Agency and NDIS Quality and Safeguards Commission to identify advertising which may be in breach of the Australian Consumer Law.
"The ACCC is concerned that many businesses continue to advertise goods or services that appear on the list of ineligible supports in a way that suggests NDIS funding can be used to purchase them. We are also concerned that many NDIS providers are claiming that certain products or services are 'NDIS approved', 'NDIS funded' or otherwise NDIS endorsed when this is not the case." - ACCC Deputy Chair, Catriona Lowe. https://bit.ly/3YKOCLJ
References:
NDIS Provider and Workforce Registration Taskforce
https://www.ndis.gov.au/providers/becoming-ndis-provider/am-i-ready/requirements-and-eligibility/your-legal-requirements
https://www.accc.gov.au/media-release/ndis-provider-in-court-over-alleged-misleading-representations-when-selling-aged-care-and-disability-products-online
https://www.ndiscommission.gov.au/rules-and-standards/ndis-code-conduct/fair-pricing
