Drafting a returns policy that provides the consumer with the information they need, protects the interests of your company and also meets legal requirements can be difficult. If you do not offer the consumer more than the minimum protection required by law a returns policy is not strictly necessary but it is generally good practice to make consumers aware of their rights. It is however illegal to display notices that mislead consumers about their legal rights, for example, stating that you do not accept returns or offer refunds.
The law provides that you must offer a full refund if an item is faulty, not as described or does not do what it is supposed to.
If you offer your consumers more than the law requires you can add conditions such as:
- a receipt must be produced;
- that you will exchange goods or give store credit but not give a refund;
- goods are unused and in the original packaging; and
- a deadline for returns.
These conditions cannot be imposed if the consumer has a legal right to return goods.
You do not have to offer a refund if the consumer;
- knew the item was faulty when they bought it
- damaged an item by trying to repair it themselves or gets someone else to do it (though they may still have the right to a repair, replacement or partial refund)
- no longer wants an item (e.g. because it is the wrong size or colour) unless they bought it without seeing it
You have to offer a refund for certain items only if they are faulty, such as:
- personalised items and custom-made items
- perishable items
- newspapers and magazines
- unwrapped CDs, DVDs and computer software
Consumers that make purchases over the internet, phone or by mail order, have the right to cancel their order for a limited time even if the good are not faulty as distance selling rules apply. The government website states that:
“You must offer a refund to customers if they’ve told you within 14 days of receiving their goods that they want to cancel. They have another 14 days to return the goods once they’ve told you. You must refund the customer within 14 days of receiving the goods back. They don’t have to provide a reason.”
Be aware that if a consumer accepts an item but later discovers that it is faulty you may still be obliged to repair or replace it. Acceptance will happen if the consumer tells you that they have accepted it or if they have altered the item. Under the Consumer Rights Act 2015 you must repair or replace an item if a consumer returns it within 6 months unless it is possible to prove that the item was not faulty when the consumer bought it.
The information contained within this article should be used as a general guideline. In all cases we strongly recommend you have your returns policy reviewed by a solicitor with experience of commercial contract matters. If you need further bespoke advice then Talk to Tollers call 01604 258558 and speak to our commercial contracts team.