Company Act 2006

By Ryan and Billy

What is the Companies Act 2006?

The Companies Act 2006 is an act of parliament that currently serves as the primary source of company law in the UK. This particular act contains 1,300 sections that span over 700 pages, with a list of contents that is 59 pages long.

There are two types of law

1. Company - How business are set up and run

2. Contract - The contracts that businesses make with employees, consumers, suppliers and so on

How does the Companies Act 2006 affect selling goods?

The Companies Act (2006) can affect the selling of goods within a business under the contract act,because if companies do not get suppliers to sign a specific contract then the suppliers are not bind to follow the contract and may not deliver products on time. This can affect the selling of goods because if products are not there to be sold then a company will not be able to sell anything to the public. This can also affect the selling of goods in the future because if a customer has not been satisfied with the service provided before hand then they will not want to return to the shop.

The Companies Act 2006 can also have an effect of selling goods when it comes down to the company law (how businesses are set up and run) because if a business is unethical then customers will not be encouraged to shop within the stores and not enough goods will be sold.

How does the Companies Act 2006 affect recruitment of staff?

The Companies Act 2006 can affect the recruitment of staff because if the business is poorly ran and owes many liabilities, this encourage members of the public to not want to work within that specific business. This could make employees fearful of not being paid on time and possible closure of the business which would lead to them needing to look for another job.

Employment law

This is aimed at protecting the health, safety and rights of employees

The main employment law that a business needs to consider are:

Employers must provide safe premises and machinery. They must ensure that workers health is not affected by their work. If the workplace is not safe and has been reported to be unsafe, applicants would be unavailable until Tesco make the workplace safe.

How does the Companies Act 2006 affect product design?

The law gives customers protection against unfair selling and miss leading information.

The consumer has basic legal rights if the product is:

  • Given a misleading description
  • Of an unsatisfactory quality
  • Not fit for its intended purpose

According to the Companies Act, false or misleading information must not be given about products. For example, accurate information must be given about who made the product. Fake designer goods that are marketed as genuine are a clear breach of the Companies Act.

This Act says that all products have to be of a 'satisfactory quality'. This means that they have to:

  • Be safe
  • Last for a reasonable amount of time
  • Be fit for their intended purpose