Why does an online business need Website Terms & Conditions?

June 28, 2021

Many people I speak to know that they need to have terms and conditions on their business website, but they don’t understand why. In this blog, I look at Website Terms and Conditions and explain what they are, why you need them, the important role they fill in your business, and why it is really not a good idea to “borrow” them from another website or use a generic one-size-fits-all template.

Website T&Cs are legally required to protect consumers

Under Australian consumer law, there is an obligation for those who are engaged in electronic commerce – that is, online entrepreneurs – to provide consumers with accurate and easily accessible information that enables the business to be positively identified.

This information is most often provided in your Website Terms and Conditions, a document usually found through a link in the footer of your website. Your Website T&Cs protect consumers by identifying the business that is offering goods or services for sale through the website, citing your ABN or ACN so they know that you are a genuine commercial enterprise. Your T&Cs also educate potential customers about your important policies, such as your payment terms, refund policy and compliance with consumer guarantees. It also contains contact information so that the people who buy from you can get in contact if they need to.

The ACCC is responsible for enforcing the consumer law. It checks commercial websites for compliance and can issue penalties, although this is more likely if a consumer complaint has been made about the business.

Your T&Cs also protect you from legal action. It is common to include a limitation of liability which aims to put a cap on or exclude claims made against you. A robust alternative dispute resolution strategy which specifies negotiation and mediation as a pre-requisite before going to court can also reduce the likelihood of being sued. Setting the jurisdiction and governing law in your T&Cs means that, no matter where in the world your clients live, it is your local law that will apply to any disputes, and any claim brought against you must be brought in the courts where your business is located.

Website T&Cs protect your boundaries & manage expectations

Well-written Website Terms and Conditions can play an important role in creating a connection between you and those thinking about buying from you, increasing trust, reducing anxiety, letting people know that they are in the right place, and educating them about what it is like to work with you.

To start with, being honest about who you really want to work with – your ideal clients – and explaining why your services may not be suitable for some other people allows your T&Cs to act as a filter, encouraging those who are not a good fit to self-select themselves out so they don’t waste your time. This is also a great way to avoid conflict before it starts. In advertising, people often think their best interests are served by glossing over the deficiencies of their program and emphasising only the positives. On the contrary, clearly telling people who should NOT buy from you and explaining the risks and limitations they may face allows your audience to make informed decisions and means that those who do choose to join you are the ones who are completely ready to experience what you have to offer.

Another important aspect of informed consent often contained in your T&Cs is your disclaimer. A disclaimer does not need to be convoluted and incomprehensible (although that is often what you will find). Think about the content of your website, program, product or service. You can’t control how people use the information that you provide, you can’t stop people misunderstanding and misinterpreting what you try to tell them, and you can’t prevent random episodes of full-moon-itis.

What you can do is get really REALLY clear about what you provide, why you provide it, how you expect it to be used, how much responsibility you accept in the circumstances and how much responsibility you expect your website users, clients or customers to take for their own safety and well-being. At its most basic, a disclaimer pretty much tells people to use their common sense and makes it clear that you warned them of any dangers, so if something goes wrong due to circumstances beyond your control, you won’t be made to pay for it.

Your T&Cs are a great place to provide clarity around the boundaries that hold space for the relationship between you and your client to run smoothly. This might include your appointment and cancellation policies, such as what happens if a client is late to a meeting, or how much notice they need to give you in order to reschedule. You can also put boundaries around how the intellectual property you share on your website or in your programs is used, preventing people from using your work commercially without your permission.

Finally, your T&Cs can be set up as a quasi-contract for low cost, low risk transactions. It is so important to educate your clients about what to expect so they are not left confused and trying to guess what you have in mind. It is also essential to ensure they are accepting your offer with full awareness of your boundaries. In most cases I work by the following rule of thumb:

  • For expensive offerings or long-term working relationships, you need a full contract. (What counts as expensive or long term will depend on your client’s perspective.) This will contain a lot of detail and you will get your clients to sign it before they work with you. This tends to mean it will be taken more seriously, and it is easier to prove their acceptance in those very very rare cases where you need to enforce it.
  • For shorter, cheaper offerings, like a one-off client session, or a low-priced group workshop or challenge, however, you might like to streamline the process by including your terms of sale in your Website T&Cs. You could include a checkbox at the point of purchase that says something like:

“By continuing with your purchase, you agree that you have read and intend to be bound by my terms and conditions. If you have any questions, please contact me here: (contact details).”

The problem with generic templates & patchwork policies

I am often asked whether it is safe to use a generic template to create your T&Cs, or to borrow your T&Cs from another business. It is my belief that your T&Cs need to come from the heart of your business, express your personality and connect in a caring way with those who want to work with you.

When you have T&Cs that are not a good fit – that have been found on the internet or drafted by someone who didn’t truly understand and adore your business – there is an energetic dissonance. They feel out of tune and unreliable, like an uncomfortable alien appendage hanging off your website because you “should” have it, not because you want it to be there. This is even worse if you have “borrowed” your T&Cs from someone else, because this is a breach of their intellectual property. Trusting your safety to something stolen is never going to feel wonderful. Do you really want to build a sense of wrongness into your business foundations?

Imagine how it would feel to have legals that were working with you to draw in your ideal clients and manifest the working relationships you desire? This can happen when you have poured your own heart and soul into their creation, when you feel like they empower you rather than weighing you down. When you write your legal documents in the same language you use for your marketing, when you understand every word of them and when they are in complete alignment with your values and vision, your T&Cs become an essential tool that supports you in doing business YOUR WAY and saves you a huge amount of ENERGY & EFFORT.

How I can help

If you are ready to create Website Terms & Conditions that are beautifully written to support you, your business and your clients, as well as fulfilling all your legal requirements, check out my Contracts That Care™ DIY Packs.

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