Syllabus: Pearson Edexcel GCSE Business
Module: Understanding External Influences on Business
Lesson: 1.5.3 Legislation and Business

Introduction

Legislation shapes how businesses operate, protect their stakeholders, and make decisions. This topic helps students understand the real impact of laws on business activities – not just as boxes to tick, but as frameworks that can create competitive advantages when handled well. We’ll explore both consumer and employment legislation, looking at their practical purpose and what happens when businesses navigate these legal requirements effectively (or poorly).

Key Concepts

According to the Pearson Edexcel GCSE Business syllabus, the key concepts under Legislation and business include:

• The Purpose of Legislation:

  • Principles of consumer law: quality and consumer rights
  • Principles of employment law: recruitment, pay, discrimination and health and safety

• Consumer Law:

  • The Consumer Rights Act (2015): covering product/service quality, returns, repairs, replacements, and delivery
  • The Consumer Protection Act (1987): ensuring product safety and producer liability
  • The Trade Descriptions Act (1968): requiring accurate description of goods and services

• Employment Law:

  • Recruitment legislation: outlining what employers can and cannot do when recruiting staff
  • Pay legislation: ensuring workers receive at least minimum wage
  • Discrimination legislation: preventing unfair treatment based on protected characteristics
  • Health and safety legislation: keeping employees safe in the workplace

• The Impact of Legislation on Businesses:

  • Cost implications: training, safety equipment, testing, higher wages, warranties
  • Consequences of meeting and not meeting legal obligations
  • Balancing compliance costs with business objectives

These concepts help students understand how legislation serves as both a constraint and a framework for ethical business operations.

Real-World Relevance

Legislation impacts businesses in ways students encounter every day:

• Retail and E-commerce: Amazon’s 30-day return policy isn’t just good customer service – it’s aligned with consumer rights legislation. When students buy something online and it arrives damaged, they’re protected by laws that businesses must follow.

• Manufacturing: Dyson invests heavily in product testing to meet safety standards. This adds to their costs but builds trust and reduces risks – a trade-off businesses make constantly.

• Hospitality: Next time students visit Premier Inn, they’re seeing employment legislation in action – from the working hours of staff to the fire safety procedures. These aren’t optional extras but legal requirements that shape how the business operates.

• Technology: Apple’s UK warranty policies reflect consumer rights requirements, while their employment practices must follow anti-discrimination laws. Even the world’s largest companies must adapt to local legislation.

These examples show how legislation isn’t just theoretical – it’s visible in every business interaction students have as consumers and potential employees.

How It’s Assessed

In exams, students will typically encounter:

• Multiple-choice questions: Testing basic knowledge of key legislation and its purpose.

• Short-answer questions: Explaining specific aspects of consumer or employment law and their impact on businesses.

• Case study questions: Identifying relevant legislation in business scenarios, explaining compliance requirements, and evaluating the impact.

• Extended response questions: Discussing how legislation affects business operations, costs, and decision-making.

Students need to know specific legislation, understand its purpose, and evaluate its impact on different businesses. Command words to watch for include “identify,” “explain,” “analyse,” and “evaluate,” with higher marks for balanced arguments that consider both positive and negative impacts.

Enterprise Skills Integration

Understanding legislation builds practical skills students can use beyond exams:

• Problem-solving: Identifying potential legal issues in business scenarios and determining appropriate compliance strategies. For example, how might a business adapt its recruitment practices to comply with anti-discrimination legislation?

• Decision-making: Balancing legal requirements with commercial objectives. When is it worth exceeding minimum legal requirements for strategic advantage?

• Critical thinking: Analyzing how legislation impacts different business functions and types of organizations.

• Ethical awareness: Understanding the ethical foundations of business regulations and developing a sense of corporate social responsibility.

These skills are valuable in any workplace where legal considerations influence decision-making – which is virtually everywhere.

Careers Links

Knowledge of business legislation connects to numerous career paths:

• Human Resources: HR professionals ensure compliant recruitment, pay, and workplace policies. Roles include HR Manager, Recruitment Consultant, and Diversity and Inclusion Specialist.

• Compliance and Legal: Specialists who help businesses meet their legal obligations, including Compliance Officers, Legal Advisors, and Health and Safety Managers.

• Consumer-facing roles: Retail Managers, Customer Service Directors, and Quality Assurance Specialists all need to understand consumer legislation.

• Business ownership: Entrepreneurs and small business owners navigate legislative requirements across all aspects of their operations.

Understanding legislation isn’t just for lawyers – it’s relevant to almost any business career path students might consider.

Teaching Notes

• Start with real examples students recognize – perhaps a local business facing a legal challenge or a news story about consumer rights. This makes the topic immediately relevant.

• Use familiar brands to illustrate how legislation impacts different business functions. How does ASOS handle returns? How does McDonald’s ensure health and safety?

• Create debate opportunities on the balance between protection and burden – are some laws too restrictive for small businesses? Not protective enough for consumers?

• Try role-play scenarios where students make business decisions while considering legal requirements. This brings abstract concepts into practical focus.

• Watch for the misconception that legislation only restricts businesses rather than also providing frameworks for fair competition and stakeholder protection.

• For extension, have students research recent changes to business legislation or compare UK business laws with those of another country.