(i) Mr Mallett's evidence summarised
155 Mr Mallett is the managing director of Employsure and has held that position since its incorporation in September 2010. Previously, Mr Mallett was a barrister based in London who specialised in employment law. He studied law at Cambridge University and obtained an LLM from Duke University in the United States. He practised at the London Bar from 2004 to 2010, when he moved to Australia with his Australian wife. He saw an opportunity to develop a business model here based upon that operated by Peninsula Business Services Limited (Peninsula) in the United Kingdom, the features of which involve providing clients with the following four services:
(a) a review of the client's current documentation, including employment contracts, workplace policies and manuals, and the preparation of any new documentation required;
(b) advice which is available at all times all year round;
(c) representation in courts and tribunals; and
(d) an insurance policy which provides an indemnity against the costs associated with any court or tribunal proceedings with no excess payable by the client.
156 This business model was adopted by Employsure, which started offering the four services in April 2014 and after Peninsula agreed to invest in Employsure two years earlier.
157 Although Employsure's model expanded into a much larger scale, it did not record a profit until the financial year 2014-2015. As at 30 May 2019, Employsure had approximately 20,500 clients, which included both large employers (i.e. with more than 20 employees) and many small to medium sized enterprises (SMEs). It had over 600 employees in various roles. As at 30 May 2019, 13 percent of Employsure's clients were large employers.
158 In April 2016, Employsure expanded its operations to New Zealand, where it had over 4,000 clients and almost 200 employees in mid-2019.
159 Mr Mallett emphasised that Employsure's services are designed specifically for employers and that the advice it provided to clients was independent from the dispute resolution and investigation functions of the FWO and FWC.
160 Initially, Employsure offered only its employment relations services, but in around March 2014 it expanded to offer its workplace health and safety (WHS) services.
161 Mr Mallett described how in 2013, Employsure began offering three different standard services to its clients. The "Tier 1" service is Employsure's basic service for businesses with less than five employees and where the review of the client's business is typically done over the telephone rather than fact-to-face. The "Tier 2" service is Employsure's original standard service, which included face-to-face meetings with clients. The "Tier 3" service is an enhanced offering which includes all elements of the Tier 2 service, plus additional on-site consultancy services (such as staff training, internal management of disciplinary processes and risk reviews). In addition to these standard services, Employsure also offers an "add-on" service called "Safe Check", for which clients are typically charged $500 but may sometimes be offered free of charge as part of a contract price negotiation. Safe Check was introduced in around 2015.
162 Mr Mallett described what was involved in Employsure providing services such as the initial compliance review, an employment relations review and the WHS services. He described what was involved in preparing a corrective action plan following an assessment of a client's documentation, as well as the "implementation meeting" which Employsure consultants conducted with a client after providing a corrective action plan. Mr Mallett annexed to his affidavit copies of the corrective action plans and related documents provided to both TDB and BPP.
163 Mr Mallett described how all of Employsure's clients had access to Employsure's ongoing advice service at all times during the duration of their contract. He emphasised that the advice service was not limited in any way by call time, length or volume of calls. He described how the telephone advice service operated 24 hours a day. He gave examples of the type of requests Employsure received over the advice service, either by telephone or email. Mr Mallett estimated that Employsure had one advisor to every 250 clients and that during the 12 months from 1 April 2018 to 31 March 2019, Employsure's advisors sent and received a total of approximately 300,000 emails with clients who requested advice. During the same period, approximately 220,000 telephones calls were received from clients seeking advice and approximately 94,000 calls were made by Employsure advisors to clients concerning requests for advice.
164 Mr Mallett gave a detailed description in relation to its clients (who are all employers) in relation to workplace claims by employees. This included claims made in regulatory bodies such as the FWO, the Australian Human Rights Commission, SafeWork NSW and Work Safe Victoria. Employsure also provided representation in courts and tribunals. Prior to mid-2018, Employsure's legal representation services in courts and tribunals were provided through Sparke Helmore lawyers but subsequently such representation occurred through Employsure's internal law firm, Employsure Law. Outsourcing claims only occurs if the matter is beyond Employsure Law's resources or expertise.
165 Mr Mallett described how from around August 2012 until March 2019, Employsure's clients had an option of taking out insurance policies which were underwritten by QBE Insurance Group Limited. One kind of policy related to the employment relations service while the other was for Employsure's WHS clients. The insurance policies covered clients' legal expenses.
166 Mr Mallett gave detailed evidence regarding Employsure's online marketing practices. He described Employsure's objective in using online marketing as "to find SMEs, or other businesses, who might have use for Employsure's services, and ultimately to form a relationship with those employers to see if they want to become clients". He described the marketing practices known as search engine optimisation (SEO) and search engine marketing (SEM). SEO is the marketing practice by which websites are sought to be "optimised" to respond "organically" to search engine enquiries, such that when a consumer searches for a term a website is returned as high as possible in the search results (below the advertisements). SEM involves bidding on search terms, known as "keywords", with a view to Google accepting a bid and an advertisement appearing in response to a particular search. The presentation of an advertisement in response to a given search is determined by Google's proprietary algorithms, which undertake an almost instantaneous calculation of the maximum amount an advertiser is willing to pay to present an advertisement, multiplied by a "Quality Score". The presentation of advertisements did not depend only on the amount paid by the advertiser, but also on the quality of the advertisement as assessed by Google. Advertisements with the highest "Ad Rank" as assessed by Google are presented above Google's organic search results. In his oral evidence in cross-examination, Mr Mallett explained that by using the words "fair work" in the URL in Employsure's Google Ads, the cost of the advertisements was reduced because it increases the "Quality Score". Mr Mallett explained that Employsure used the term "fair work" in its URL so as to reduce the cost of its advertising with Google. I accept that evidence.
167 Mr Mallett gave detailed evidence as to the three constituent parts of Employsure's SEM strategy, namely its keyword strategy, its Ad Copy strategy and its landing page strategy. The keyword strategy involved Employsure selecting a series of keywords which it believed prospective clients might search for. Many of those keywords included the phrase "fair work" because such terms are likely to be relevant to employers who may be prospective clients for Employsure. Mr Mallett also emphasised that the words "fair work" are part of the name of two relevant regulatory bodies operating in the employment relations area, namely the FWC and FWO. The words "Fair Work" also appear in the name of the primary legislation. Mr Mallett deposed that the purpose of Employsure bidding on the search terms, including the words "fair work", is to seek to present Employsure's advertisements to internet users who might wish to use Employsure's services and that there was no purpose of conveying any organisational association with, or endorsement from, either the FWC or FWO.
168 Mr Mallett described how Employsure used negative keywords so as to prevent Employsure's advertisements appearing in response to a search. Employsure currently uses 60,000 negative keywords, such as "fair work employee", which are intended to exclude employees accessing Employsure for information about fair work.
169 Mr Mallett pointed out that part of Employsure's keyword strategy was the price that Employsure was willing to pay for each click. Employsure limits price per click by budgeting through Google's advertising platform. If the price per click budget is set too low, Employsure's advertisements would not be preferentially placed. If the price per click budget is set too high, Google may accept the higher bid unnecessarily or SEM could otherwise become too expensive as a way of finding new clients. For these reasons, Mr Mallett said that Employsure closely monitors the price per click to ensure that it is budgeting optimally. Finally, he said that Employsure's keyword strategy is designed to have its advertisements only being presented to employers who require advice, or who may be prospective clients of Employsure.
170 Mr Mallett's description of Employsure's Ad Copy strategy involved three elements, namely the headline, the display URL and the description. Google Ads are distinguished from organic search results by the term "Ad" appearing in the box just below the headline, although this may vary if a mobile device was being used. Some Employsure Google Ads also included the phone numbers that could be dialled without clicking through to a website or landing page.
171 Mr Mallett said that Employsure had two objectives in its Ad Copy drafting. First, to exclude searchers who were not employers or prospective clients (particularly employees). Thus Employsure's advertisements clearly stated that the services were for employers only. Despite this, many employees still click on Employsure advertisements, which take them to an Employsure website and this has the consequence of generating a payment to Google from Employsure.
172 Secondly, Mr Mallett stated that Employsure seeks to attract potential clients to its website or landing pages by advertising a free advice service. He said that this is intended to help the potential client with the problem that has led the person to the search engine in the first place.
173 Mr Mallett described how during the relevant period Employsure used not only its own website but also the following landing pages - fairworkhelp.com.au, employersupport.com.au and employerline.com.au. These landing pages are websites with different domain names. Their main benefit, according to Mr Mallett, is that they offer a simple "call to action" for an employer to call Employsure and request advice, as opposed to navigating Employsure's more complex main website (www.employsure.com.au).
174 As to the URLs used by Employsure for its landing pages, Mr Mallett said that this was done for several reasons. For example, in using "fairworkhelp", this URL incorporated the name of the legislative regime about which Employsure advises its clients, who are employers seeking help with that regime. He said that this URL also incorporated keywords used by Employsure, which can have the effect of increasing the landing page's Quality Score. Mr Mallett stated that Employsure's use of landing pages was based on Peninsula's practice in the UK. It is intended to provide a wider range of possible audiences and increase the likelihood that a larger number of people will come into contact with Employsure's services, including its free advice helpline. He said that Employsure's landing pages were not intended to produce confusion or suggest an association with any government body, such as the FWO and the FWC.
175 Mr Mallett acknowledged that Employsure made changes to its "fair work help" landing page between January 2016 and 30 November 2018. For example, in September 2017, Employsure added this statement:
This free helpline is provided by Employsure, Australia's largest provider of workplace relations advice to employers. It is a private business with no affiliation to any government agency. It provides this helpline as part of its commitment to helping all business owners achieve fair and safe workplaces.
176 At the same time, Employsure added a further statement that it had no affiliation to any government agency, including the FWO. Under cross-examination, Mr Mallett explained that these changes were made after Employsure had been contacted by the FWO, who complained that its intellectual property was being misused. Mr Mallett explained that changes were made, not because Employsure accepted that there was any substantial issue with either intellectual property or consumer protection matters, but rather because he wanted to avoid Employsure becoming involved in litigation, such as that which has now occurred. I accept that evidence.
177 Mr Mallett gave detailed evidence regarding Employsure's free advice helpline, including the recorded telephone message played to a caller when the number is dialled. He described how various changes were made to the pre-recorded welcome message. Those changes are reflected in the following extracts:
(a) during the period from around 31 December 2014 to around 25 November 2016, the pre-recorded 'welcome' message stated:
Welcome to Fair Work Help. This advice line has been specifically designed to support employers and business owners. Please listen carefully and select from one the following options. If you are an employer or business owner, press 1. If you are an employee calling on behalf of an employer, press 2. If you are an employee requesting advice about your own situation, press 3.
(b) during the period from around 26 November 2016 to around 22 August 2017, the pre-recorded 'welcome' message stated:
Welcome to Employsure Fair Work Help. This advice line has been specifically designed to assist employers and business owners. This call may be recorded for quality assurance purposes. Please listen carefully to the following options. If you're an employer or business owner, press 1. If you're an employee calling on behalf of an employer, press 2. If you're an employee requesting advice about your situation, press 3.
(c) during the period from around 23 August 2017 to around 4 June 2018, the pre-recorded 'welcome' message stated:
Welcome to the Employsure's Fair Work Help. As Australia's leading independent workplace relations provider, we offer this service to support employers and business owners. We can provide you support with fair work matters but we are not affiliated with the government. This call will be recorded for quality and training purposes. Please listen carefully to the following options: If you are an employer or business owner, press 1. If you are calling on behalf of an employer, press 2. If you are an employee requesting advice about your situation, press 3.
(d) during the period from around 5 June 2018 to around August 2018, the pre-recorded 'welcome' message stated:
Welcome to Employsure's help line for business owners. Employsure is not affiliated with any government agency. This call may be recorded for quality assurance purposes. If you're an employer or calling on behalf of an employer, press 1. If you're an employee requesting advice on your own situation, press 2.
178 Mr Mallett explained that the recorded message was designed to divide callers into different categories, namely employers, people calling on behalf of employers and employees. He emphasised that Employsure only wanted to engage with people in the first two categories. Callers who select the option designated as "employees" are diverted to a pre-recorded message that informs them that Employsure works only with employers. Employees are directed to the telephone number for the FWO.
179 On the issue of the class of persons to whom Employsure's Google Ads were directed, the ACCC submitted that Mr Mallett accepted in cross-examination that the target audience was not confined to employers alone and included employees. It relied upon the following exchange:
… I want to suggest to you that you do have the information because you are aware of the design of the ads, which I suggest to you are intended to appeal to persons who are searching for the Fair Work Ombudsman website, be they employers or employees?---No. The intention of the advertisements is to appeal to anyone seeking help, which may include people that are seeking the Fair Work Ombudsman website, but is also people that might be seeking information about the Fair Work Ombudsman may be involved in a wages dispute with the Ombudsman. There are a whole range of reason people might search, and we're seeking to attract as much traffic as we can off that group of people. (Emphasis added by ACCC).
180 I do not accept that submission. Mr Mallett made it quite clear in both his written and oral evidence that Employsure's target audience was limited to employers. For example, earlier in his cross-examination Mr Mallett said:
We would like less employees to call us, but, notwithstanding changes that we do make, it still happens.
Employsure had a strong commercial incentive to limit the number of employees who contacted it via Google Ads because Employsure was obliged to pay Google each time such a person called even though Employsure would not provide services to an employee.
181 The ACCC also relied upon what Mr Mallett said when it was put to him that if an employer entered the terms "fair work" with the intention of locating the FWO for the purpose of getting free advice, it was possible that Employsure's Google Ad might be displayed as a result of that search. Mr Mallett agreed that that was a possibility. When it was then put to him that an employer making such a Google search "is the very person who you reach out to by publishing your Google Ads", Mr Mallett responded as follows:
We - we publish ads to - to those people but that's not necessarily the same thing to say that they are always the people that we want as clients.
182 When read in context, I do not accept the ACCC's submission that Employsure's Google Ads were directed to a wider class than employers. I understand Mr Mallett to be saying that employers are Employsure's target audience but that is not the same as saying that all employers are necessarily sought by Employsure as clients. This was made clear by Mr Mallett later in his evidence when he drew the distinction between employers simply seeking free advice as opposed to employers seeking free advice and who might also become clients of Employsure:
But my point is confined to a circumstance in which the employer is seeking free advice from the Fair Work Ombudsman and that's how you understood my question, wasn't it?---I believe I did - that we were seeking to get those people to click on our ads. I think that was the question and the answer is not unless they might want to be a client. If they simply wanted free advice and nothing else our intention would be to not have them come to us or at least at some stage in the process with us, identify that they're not going to be clients.
183 Mr Mallett stated that the free advice helpline gave Employsure's potential clients the opportunity to experience the nature and quality of Employsure's advice before entering into a formal contract. In this way, the free advice helpline also performed a marketing function in the sense that, if a potential client found that advice to be useful, the person was more likely to agree to meet with one of Employsure's BDMs to discuss Employsure's services. Mr Mallett was closely cross-examined on this topic. When it was put to him that the primary function of the helpline was to market Employsure's services to potential clients, Mr Mallett responded:
… The - the overall, or overarching, function of the helpline is indeed marketing, in a number of perspect - in a number of respects. And the - even the advice element to it is a form of marketing in that, in providing advice, we are showing ourselves to give advice of a certain standard. And even if the person doesn't want or need a meeting with us at that stage, they're left with a good feeling about Employsure. That's undoubtedly the overarching intent, along with the other marketing purpose, which is to seek to book an appointment with those who might become clients.
Well, can I say that, one of my questions was going to be, and you may have pre-empted it, do you agree that your advice is a form of marketing?---Yes. I agree. It - in - as I was once told in my career, we all work in sales to some degree, and so, yes, everything that we do is a form of putting our best foot forward to - to show what we can do for clients.
184 Earlier in his cross-examination, Mr Mallett described the purpose of the helpline as "first of all to provide them with some support to show the level of service that we can provide" and to enable potential customers "to consider whether our services might be useful for them". Later, Mr Mallett said:
We want to have the ability to speak to them, show them a, if you like, a taste of the service that would could provide to them, and we will subsequently explain the fuller version of what we do and the costs associated with that.
185 Several times in his cross-examination, Mr Mallett explained how the free advice service was set up separately from Employsure's paid services, so as to separate out the Employsure commercial brand. He expressly denied that Employsure set out to mislead consumers by not including the name Employsure in the advertising. I accept that evidence.
186 The ACCC relied upon this evidence as supporting its claim that the Free Advice Representation was misleading and deceptive (or likely to be so) because that is not how the helpline was represented to consumers in the Google Ads and landing pages. For reasons which will be given below, I do not accept that claim.
187 Mr Mallett gave a detailed description of the usual content of an initial meeting by a potential client with one of Employsure's BDMs. This generally entailed a discussion of the length of any contract, the particular contract tier, the services to be provided under the contract, the total contract price and the frequency and amount of payments. He described how some clients sign their contract with Employsure during the initial face-to-face meeting and, on other occasions, a copy of the contract is subsequently emailed to the client for their review to sign at their convenience or at a subsequent meeting with Employsure.
188 Mr Mallett gave detailed evidence concerning Employsure's standard contracts (copies of which were annexed to his affidavit), which did not change during the period 12 November 2016 to October 2018. Mr Mallett was personally involved in formulating the standard contract terms in place during this period.
189 I accept Mr Mallett's evidence that there were legitimate commercial reasons for Employsure to not change the impugned terms during the period the subject of the ACCC's case. With specific reference to the particular terms of the standard contract which are the subject of the ACCC's claims of unfair contract terms, Mr Mallett's evidence may be summarised as follows.
190 As to the no termination clause, Mr Mallett said that its principal commercial justification is "to ensure that, absent fundamental breach by other party, the contract remains on foot for the term agreed". He said that this protects Employsure against the possibility of a client terminating a contract before Employsure has recovered the costs it has incurred in providing services. He further explained that Employsure undertook significant work for a new client in the initial phase of the contract period and at significant cost (including the costs associated with the compliance review, as well as out-of-pocket expenses such as travel, stationery and other document production costs). In circumstances where most of Employsure's clients paid monthly fees rather than up-front fees, Mr Mallett said that in the initial phase of the contract period there was a mismatch between the costs incurred by Employsure in servicing the client and the receipt of contract fees.
191 Mr Mallett added that another reason for not permitting early termination related to the volume of contracts Employsure had on foot with clients at any point in time, each having differing levels of service requirements. He said that the aggregate level of demand cannot be predicted with certainty by Employsure in advance. To cater for this, Employsure had to maintain a sufficiently large workforce and other resources to meet the level of services that could be required over a lengthy period from all Employsure's clients. He said that this resulted in Employsure having a high fixed cost base. He added that the no early termination clause helped Employsure mitigate the risk of not being able to meet those costs. Mr Mallett was closely cross-examined on this evidence, but I accept his explanation as providing a legitimate commercial justification for the clause. I refer in particular to the following response from Mr Mallett in cross-examination:
Well, I suggest to you that that's a more appropriate means of protecting your commercial interest than a no early termination clause without that qualification?---As I say, we have learned that and that's why we have adjusted it. But the contract as it was was built upon the basis that, at the beginning of 2012, middle of 2012, I should say, when the terms first came into effect, we only had 100 clients and had no idea - we didn't make a profit until the end of the financial year in 2015. It took us a number of years to get to profit and we had no idea what the metrics of the business would be to get us to profit.
192 As to automatic renewal, Mr Mallett said in cross-examination that its business justification is that his "experience of emailing and contacting clients is that it is actually administratively very difficult to contact and get active responses from a 25,000-plus client base". He accepted that an email could be sent asking clients to express any objection to an increase in price but that Employsure believed that "it is better to put it up front that that is what will happen to the client upon renewal so they can see it there on agreement in the contract". I accept that evidence. Mr Mallett amplified this by saying that, as at 30 May 2019, Employsure had approximately over 20,000 contracted clients in Australia, with approximately 1,000 of them renewing their contracts each month. This had significant resource implications for Employsure and staff costs.
193 With reference to the clause in Employsure's contracts regarding automatic price increases on contract renewal, Mr Mallett explained that this provision was intended to protect Employsure against the effects of inflation over the long term. The proposed increases are designed to be consistent with CPI increases over time.
194 As to the clause relating to default in payments resulting in the total contract balance price becoming payable immediately in full, Mr Mallett repeated and adopted the reasons advanced in respect of the clause prohibiting early termination. In particular, he emphasised that Employsure's contract for services is a contract for an upfront sum paid by clients in instalments over the course of the term. He added that the clause was justified because Employsure's consultancy service represented a large portion of the costs in providing services to Employsure's clients and those costs were incurred early in the contract term. Mr Mallett said that the clause was "intended to protect Employsure from the commercial risk of clients stopping payment early in the contract term after these costs had been incurred by Employsure but not yet covered by the payments made by the client".
195 When it was put to Mr Mallett in cross-examination that in 2015 the company was voted as Australia's fastest growing company and it was quite profitable and successful at that time, with the implication that it should have changed the impugned contract terms earlier than it did, Mr Mallett responded by saying:
… We reached profitability in 2015, we still had significant - we weren't cash profitable at that point, I should add, but we still had significant loans to pay back, and so forth. So we were becoming established as a business I would say, and that has been a process that we're continuously on.
I accept that evidence.
196 Mr Mallett described the role and responsibilities of Employsure's BSCs, which he divided into Inbound and Outbound roles. Outbound BSCs are responsible for contacting potential clients by telephone and email. They do not give advice to potential clients. Outbound BSCs make calls to employers who have previously contacted Employsure or have had some other interaction with the business, including downloading information from Employsure's website. Employsure had in place practices, policies and procedures which applied to BSCs. These matters included Employsure's company values, which included a requirement that BSCs conduct business honestly. Mr Mallett annexed to his affidavit a copy of Employsure's current values and behaviours guide dated June 2019, together with an earlier version of the document that was used from 2015 to mid-2019.
197 Mr Mallett described a package of documents which were sent to all new BSCs. Those documents included an employee handbook which contained a company-wide code of conduct (a copy of which was annexed to his affidavit). The material also included a position description, which explicitly required the employee to adhere to Employsure's honesty value. A customised code of conduct was also supplied to all BSCs, which included rules relating to "misselling" and misrepresentation. Mr Mallett annexed to his affidavit a copy of the code of conduct dated July 2016. Since March 2014, the code of conduct included the following statement with respect to what Employsure described as "Premier leads" (which refer to a consumer's response to Employsure's marketing actions):
4 Premier leads
I confirm that when contacting or speaking with potential new clients, who have come from a Premier campaign, I will ensure that I make it absolutely clear that I am a representative of Employsure Pty [sic] and not from Fair Work Australia (FWA) or any other related government body.
Moreover, if any potential new client gives me the impression that they believe that I am a representative of FWA, or that Employsure are in some way connected to FWA, then I will not allow them to remain under that misapprehension. I will make it perfectly clear to them that Employsure has no connection with FWA; that Employsure services are very different to those of FWA, and that I am speaking with them to offer an overview and to discuss the products and services available from Employsure.
And, if that should ever happen, then I will also always ask the potential new client whether they are willing to continue with the meeting in the light of the clarification that I have provided.
198 Mr Mallett said that BSCs were also supplied with a copy of Competition and Consumer Legislation Guidelines.
199 Mr Mallett described the induction and training provided to BSCs. He said that prior to around April 2018, this involved a standard two-week induction training. A list of training sessions attended by the inbound BSC team during the period 2016 to December 2018 was put in evidence, upon which Mr Mallett was cross-examined.
200 In addition to training courses, Inbound BSCs have at various times been provided with versions of Employsure's BSC Guide and the BSC Script Book. Mr Mallett personally drafted the first Business Sales Guide, which described the role of an inbound BSC, Premier 1 leads, suggested script and how an inbound BSC should approach the "Pitch" stage of a call. He annexed to his affidavit a copy of the BSC Script Book dated December 2015, which included scripts for both Inbound and Outbound BSCs. He also supplied copies of a BSC Guide dated January 2017, the Employsure's Inbound User Guide dated February 2017, and the BSCs script book dated June 2017.
201 Mr Mallett described how BSCs were remunerated by way of a base salary and a commission based on the value of business contracts signed. He elaborated upon this evidence at some length under cross-examination.
202 Mr Mallett separately described the role and responsibilities of BDMs, who attended meetings booked by BSCs with potential clients. He gave similar detailed evidence about induction, training and remuneration with respect to BDMs as he did with BSCs. Mr Mallett annexed copies of relevant materials to his affidavit. Mr Mallett was also cross-examined at some length on the subject of commissions paid to BDMs.
203 Mr Mallett described the role and responsibilities of Employsure's consultants, who typically have tertiary qualifications in human resources, specialising in employment relations or some other relevant area such as employment law. He said that consultants are responsible for conducting an initial compliance review of a client's business. He described the training given to consultants.
204 Mr Mallett described the role and responsibilities of Employsure's advisors who operated the 24 hour Advice Line. As at June 2019, over 170 people were employed in the Employsure Advice Team in Australia and New Zealand. Mr Mallett described the processes which occurred when the helpline was called. He explained that some inbound calls were answered by Employsure's "First Respondents", who are client service representatives trained to determine where inquiries, including client advice inquiries, should be directed.
205 Mr Mallett described the general ongoing training provided to all Employsure employees, including access to the company's online training program called "Litmos".
206 Initially, the ACCC submitted that "Mr Mallett was not being candid" in respect of some of his evidence. When the Court invited the ACCC's senior counsel to clarify what the ACCC's submission was concerning Mr Mallett's reliability and credibility, he asked for an opportunity to obtain further instructions. Subsequently, senior counsel confirmed that the ACCC's position was that the Court should not accept some aspects of Mr Mallett's evidence but "we don't ask your Honour make some general adverse finding as to his credibility". One matter on which the ACCC asked the Court to reject Mr Mallett's evidence was his denial that the use of the keywords and the design of the Google Ads was done with the intention of misleading consumers.
207 I found Mr Mallett to be an impressive witness. He gave his evidence thoughtfully and honestly. He was also responsive in what proved to be a searching cross-examination. He displayed an impressive knowledge and command of all aspects of Employsure's operations, which may reflect his extensive personal involvement in establishing and growing Employsure's business. The ACCC quite correctly did not press its initial request that the Court make an adverse finding regarding Mr Mallett's credibility. I accept all his evidence, including his evidence concerning the reasons why Employsure selected particular keywords and designed the Google Ads as it did. I reject the ACCC's criticisms of Mr Mallett's denial that the selection and design were done with the intention of misleading consumers. Mr Mallett gave a convincing explanation for why Employsure acted in the way that it did, which did not appear to contravene any regulatory prohibition. As previously mentioned, I also accept Mr Mallett's explanation as to why Employsure did not change the impugned terms of its standard contract during the relevant period, which evidence provides a legitimate commercial justification for those terms.