Appeal filed for company’s misleading affiliation with government agency

The Australian Competition and Consumer Commission (ACCC) has appealed a $1 million fine judgment against an employment relations adviser Employ Pty Ltd for advertisements that misrepresent the company as a government agency or its affiliation with a government agency.

In August of last year, the Federal Court upheld an appeal by the ACCC, ultimately fining Employsure $1 million for making false or misleading statements in its Google ads between August 2016 and August 2018.

The ads appeared in response to search terms such as “Fair Work Ombudsman”, with return results such as “Help from the Fair Work Ombudsman – Free Advice for Employers 24/7” and “Advice from the Commission Fair Work – Free Advice for Employers”.

An example of Google ads managed by Employsure (provided by ACCC).

The unanimous decision from the full court bench found that the company breached Australian consumer law for falsely stating it was a government agency when it was not.

But the ACCC is now seeking to appeal the amount of the penalty – arguing that a fine of less than $5million for the conduct of Employmentsure is “demonstrably insufficient”.

Commission Vice-Chair Mick Keogh said Google’s Employment ads had potentially misled thousands of Australian businesses into believing they were dealing with either a government agency or a company affiliated with it.

He added that a higher penalty against Employsure would send a clear message to internet advertisers that misleading consumers was a serious offence.

“Any attempt to misrepresent a business as part of the government is a serious breach of trust and our consumer laws,” Keogh said.

“We believe that a higher penalty is necessary and appropriate given the nature of the conduct and the size of Emploisure, to ensure that advertisers on the Internet are sufficiently deterred from misleading consumers about the person with which they deal.”

The court order that Employsure faces a $1 million penalty follows another successful appeal by the commission last year; however, the full bench determined the amount of the fine based on a previous finding by Federal Court Judge John Griffiths that the conduct was not deliberate.

A ruling by Justice Griffiths in October 2020 – who accepted evidence that at the time a consumer registered with Employmentsure, its internal processes meant that consumers should have known that the services were provided by Employsure and that Employsure was not affiliated with or endorsed by the government – was relied upon by the full Federal Court to reach the sum of $1 million.

In a statement last November, Employmentsure CEO David Price said that although the company was disappointed with the result, it accepted the court’s decision without reservation. He also noted a reference Judge Griffiths made to the ACCC’s $5 million fine request, saying it left the judge “gagged.”

“We have never claimed to be affiliated with or endorsed by any government agency, and we always stand by that,” Price said.

“[Justice Griffiths said the ACCC’s] the injunction, which was ultimately dismissed, “did not demonstrate that a useful purpose will be served by one, and that the conduct was not deliberate or likely to recur,” he said.

Price went on to say his company has made “significant changes and improvements” since the ACCC alerted Employsure to the advertisements in 2018.

“We’ve gradually beefed up our messaging to avoid future ambiguity, including language monitoring on our websites if someone clicks through Google,” Price said.

The hearing date for the ACCC’s final appeal to the full Federal Court is yet to be confirmed.


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