Syllabus: Pearson Edexcel AS Business
Module: External Influences
Lesson: 2.5.2 Legislation

Introduction

This article unpacks 2.5.2 Legislation, part of the External Influences section in the Pearson Edexcel AS Business specification. It explores how laws impact business operations and decision-making. As per the official syllabus, students must understand how legislation can affect a business’s costs and demand, and how it relates to key areas such as consumer protection, employee rights, and environmental responsibilities.

For teachers, SLT, and careers leads, this is a prime topic to bring theory to life through current case studies and enterprise thinking. For students, it’s about linking legal frameworks with the practical realities of running a business today.

Key Concepts

Under 2.5.2 Legislation, students must understand:

• The impact of legislation on business operations – including areas such as health and safety, employment, product safety, and consumer rights.

• How legal changes can influence business costs – through compliance, training, or penalties.

• How legislation can affect demand – e.g., by protecting consumers or building trust in ethical practices.

• Different types of legislation relevant to business, including:

  • Employment law (e.g. minimum wage, anti-discrimination)

  • Consumer protection law (e.g. Consumer Rights Act)

  • Health and safety regulations (e.g. HSE requirements)

  • Environmental law (e.g. waste disposal, emissions)

• The importance of compliance and the consequences of legal breaches.

This sits within Theme 1 of the AS syllabus: Marketing and People, specifically under the subtheme External influences.

Real-World Relevance

In the current business landscape, legislation isn’t abstract – it’s actively shaping how businesses operate. Consider these examples:

• Deliveroo and gig economy rulings: Courts ruled that riders should be treated as workers, not independent contractors. This raised costs for businesses and shifted hiring strategies.

• GDPR enforcement: Data protection legislation has transformed how even small businesses collect and store customer data.

• Plastic packaging bans: Retailers and manufacturers had to quickly adapt to new environmental regulations, affecting production costs and branding strategies.

Mini Case Study: Pret A Manger faced legal action over allergen labelling after a customer died from an allergic reaction. The fallout led to legislation known as Natasha’s Law, which now requires full ingredient labelling on pre-packaged food.

These examples are excellent springboards for in-class debate and extended written responses.

How It’s Assessed

Students can expect legislation content to appear in both short-answer and extended-response questions. Common command words include:

• Explain – where students must describe cause-and-effect relationships.

• Analyse – typically in relation to how legislation affects business performance.

• Evaluate – requiring students to weigh up the impact of different laws on a business, possibly offering recommendations.

Assessment is often scenario-based, meaning students must apply their knowledge to a fictional or real-world context. For instance:

“Analyse how new environmental regulations might affect a medium-sized manufacturing firm.”

Mark schemes reward clarity, application, and evaluation – not regurgitation of legal jargon.

Enterprise Skills Integration

This topic naturally builds:

• Problem-solving – understanding how to navigate constraints set by the law.

• Risk management – evaluating the cost of compliance versus non-compliance.

• Decision-making – choosing between legal routes or adapting strategies to new legislation.

• Ethical reasoning – exploring the overlap between “what’s legal” and “what’s right”.

Teachers using Enterprise Skills tools like MarketScope AI can simulate regulatory shifts for student teams to respond to — useful for building confidence in dynamic business environments.

Careers Links

Understanding business legislation connects directly to the following career pathways:

• Human Resources – interpreting and implementing employment law.

• Compliance and Risk Management – ensuring organisations meet legal standards.

• Environmental Consultancy – advising on sustainable practices in line with legislation.

• Marketing and PR – adapting communication to comply with advertising standards and data protection.

In Gatsby Benchmark terms:

• Benchmark 4 – Linking curriculum learning to careers.

• Benchmark 5 – Encounters with employers (ideal to invite a legal or HR professional in to talk about legislation in practice).

Teaching Notes

Top Tips:

• Use current news stories to contextualise legislation. Students engage more with real people and real consequences.

• Create “compliance challenge” tasks – where students role-play business owners adapting to new laws.

• Link to other spec points – such as ethics, costs, and competitiveness.

Common Pitfalls:

• Students often see laws as static rather than evolving. Reinforce that legislation changes and businesses must stay agile.

• Misunderstanding the difference between legal compliance and ethical responsibility. Clarify this early on.

Stretch and Challenge:

• Introduce debates: “Should fast fashion firms be fined more heavily for environmental breaches?”

• Encourage students to explore the legal responsibilities of multinationals operating in multiple jurisdictions.