Legal factors

• What is company law?

  Provides a framework that gives companies the flexibility to compete and grow effectively.
• Employment legislation

  A law that protects people from being discriminated in the workplace and in wider society. This includes:

  • Health and safety
  • Age discrimination
  • Racial or belief-based discrimination
• Consumer protection legislation


  Laws to protect the consumer from unscrupulous firms. This includes:

  • safety of goods
  • labelling
  • the right to return goods
  • protection against untruthful claims about the product or service
• Competition policy


  This regulates the way in which businesses compete. This includes:

  • Control of the merger of businesses
  • making cartels and price fixing illegal
  • investigation of businesses who are believed to have too much control over the market
  • restrictions on one business undercutting others
• Intellectual property law


  This covers the legal rights of individual and companies in regard to designs, inventions and artistic works. This includes:

  • Trademark Legislation
  • Patent Law
  • Copyright Law.
• Data protection 


  Data protection is concerned with how personal data gathered by organisations is used and kept secure. When collecting data, it must be:

  • used fairly and lawfully
  • used for limited, specifically stated purposes
  • used in a way that is adequate, relevant and not excessive
  • accurate
  • kept for no longer than is absolutely necessary
  • handled according to people’s data protection rights
  • kept safe and secure.
• Health and safety law


  Employers have a responsibility to ensure the well-being ans safety of their employees. This also includes the safety of the working environment as well as adding rules to ensure safety law (E.g wearing hard hats when working at a construction site).
• What is minimum wage?

  The minimum amount employers pay their employees per hour,
• Benefits of minimum wage to employers

  • Reduces the need to negotiate with unions about pay which could have lead to dispute
  • Can motivate the workforce more as they are happy to receive more money
  • More use of zero hour contract as employers pay the hours they work
• Drawbacks of minimum wage to employers 


  • May be tempted to employ cheaper yonger workers than ones who have more experience
  • Wage costs would increase with any rise in min. wage which could affect profit
  • Increase in wage could lead to cost-push inflation and could see the cost of raw material increase
• Benefits of min. wage to employees

  • More disposable income due to increase
  • Younger people will find it easier to get jobs as it is cheaper to employ
  • More supply of labour as working becomes more attractive
• Drawbacks of min.wage to employees

  • Older workers may find themselves at a disadvantage as employers will favor young people more'
  • Loss of job security if business is trying to reduce expenditures to increase profit
  • Businesses may move production abroad if it can provide cheaper labor
  • Little benefits are received when min. wage increase