Energy company AGL South Australia and its marketing company CPM Australia have copped a $60,000 penalty, by consent, for illegal door-to-door sales practices.
The penalty is the second AGL has incurred this year for its door-to-door sales techniques, after it was fined $1.555 million in May.
This penalty follows an Australian Competition and Consumer Commission investigation which revealed a salesperson representing AGL attempted to sell to a consumer with a “do not knock” sign on their door.
The conduct occurred in November 2011 and in this instance the sign was affixed to the consumers front door and had an image of a fist knocking with a line through it and the words “DO NOT KNOCK Unsolicited door-to-door selling not welcome here”.
Despite the sign, the representative knocked on the door and began negotiating with the consumer.
When the court action began in October, TressCox Lawyers partner Alistair Little told SmartCompany the sign is treated by the law as the salesperson being asked to vacate the premises.
“There is a specific requirement for the person doing door-to-door to leave immediately when asked to,” he said.
“They took the view that this is a clear indication that the person did not wish to have the person make a door-to-door sale under any circumstances. This meant they were immediately in breach of the legislation.”
The Federal Court has ordered AGL South Australia to pay a penalty of $35,000 and CPM to pay $25,000.
Justice Middleton found the behaviour of the salesperson was deliberate.
“The contravention subverted both the consumer’s desire not to be disrupted or interrupted by sales representatives and the very protections provided to the consumer by the legislation,” he said.
“These penalties reflect the need to deter conduct of such seriousness by the relevant respondents and others in the door-to-door selling industry.”
The laws state sales people can online call on consumers between 9am and 6pm Monday to Friday and 9am to 5pm on Saturdays. Other obligations include not returning to a house for at least 30 days after knocking and informing customers of a 10 day cooling off period.
Salespeople are also required to identify where they are from and the nature of their visit. They’re also obliged to tell consumers that if asked, they must leave the premises.
Little said to ensure a business’s salespeople are compliant, they need a strict training program.
“You can have an arrangement with the company which includes penalty provisions in case they cause you losses or damages in the event consumer laws are broken,” he said.
“If such an arrangement is in place then the contract can be terminated, and payment won’t be made should breaches occur.”
In May this year AGL Sale and AGL South Australia were fined a total of $1.555 million for making false representations to consumers.
In November, Australian Power and Gas was ordered to pay $1.1 million for illegal door-to-door sales practices after sales representatives told consumers that APG had approval, or was affiliated with, the consumer’s existing energy retailer.
