Covid-19 policy for e-commerce and amendments to delivery and refund policies

Coronavirus has seen a large increase in online shopping and businesses have had to respond just as quickly to adapt to the new norm. Part of this change requires careful consideration of how you should change your terms and conditions of sale, particularly when it comes to handling deliveries and refunds.

Phil Moir, commercial solicitor and director with Richard Reed Solicitors, points out that ‘There have been no amendments to the Consumer Rights Act as a result of the pandemic and so it has become incumbent upon businesses to amend the rights afforded to consumers as they deem appropriate, while still staying compliant with the current laws.’

The easiest way to account for changes during this time would be to draw up a Covid-19 e-commerce policy that effectively (albeit temporarily) overrides your terms and conditions, delivery, and refund policies.

Implications for your delivery policy

Aside from a pop up on your website landing page letting customers know deliveries may take longer than usual, it is worth considering the following implications and potential changes to your delivery policy:

  • Can you disable delivery options where they need to be signed for?
  • If your terms and conditions are specific about when you dispatch after the date of order confirmation, can you change this to avoid tying yourself to a deadline you may not be able to meet?
  • Can you shorten the lead time between order confirmation and dispatch to reduce the risk of consumers cancelling their order during this time and you then having to retrieve items already dispatched?
  • If your terms and conditions do not have a force majeure clause, is now a good time to add one?

This has generally been a time of kindness and community spirit, but delayed delivery times and a relaxation of signing procedures, could also open up opportunities for claims that products were never received and so it will be important to be vigilant to prevent this from happening more than usual.

Only sending items with tracking could be one solution although this could trigger increased delivery costs, which need to be passed onto the consumer, or you could increase the order value threshold for free delivery.

Another solution could be to add in a provision that time will not be of the essence as far as delivery is concerned, and any claims for failed delivery will only be considered after a certain period of time and once you have had an opportunity to investigate the tracking.

If you have had to change delivery partners during the pandemic, remember to cross check with your data and privacy policies to ensure it covers personal data being shared with any new partners.

Implications for your refund and returns policy

If you rely on just the minimum statutory cancellation policy of 14 days after the consumer has received the goods, then offering a longer goodwill guarantee period for consumers to change their minds may be a prudent customer relations strategy which you may wish to introduce temporarily.

Usually consumers would have a further 14 calendar days to return the goods back to you after they have informed you that they wish to return goods. Given the delays in postage and courier services, it is worthwhile making the terms around refunds tighter. One way of implementing this is to issue refunds only after you have received goods rather than beforehand if your terms previously allowed for or were silent on this.

Similarly, for damaged or defective goods due to be replaced, make sure your terms allow plenty of time for you to send these and, if economically viable and suitable for your business, consider simplifying the process for this by only requesting photos rather than returns of damaged or defective goods.

You can and should still retain conditions around preserving the goods in a saleable unused condition and original packaging, not just for resale purposes, but to also complement your own Covid-19 e-commerce policy relating to limited contact and contamination risk on surfaces.

As a matter of good practice, consider making it clear to your consumers where to find your adapted returns and refunds policy or better still incorporate it all into your Covid-19 e-commerce policy.

Handling returned goods

Depending on whether you utilise a third-party warehouse partner or you have your own premises, you may wish to let consumers know how returned goods will be handled for resale purposes.

We have seen bigger businesses offering returned goods at a discount to minimise restocking, repackaging, cleaning time and fees associated with receiving returned goods.

Another option could be to have in place cleaning procedures for all goods received, keeping them separate for a certain period of time away from your other stock before offering them back for sale.

If you sell items that cannot be easily resold without a rigorous system in place for deeper cleaning, such as clothes, toys, or soft furnishings, consider how these categories of items need to be handled upon return back to you and to sell on later.

It would also be reassuring to consumers to outline this in your Covid-19 e-commerce policy.

Other terms related to order fulfillment

An obvious impact of the coronavirus on e-commerce businesses has been a high demand for certain products and supply chain issues leading to lack of availability for some items. It can be frustrating for consumers to visit your site and see so many items out of stock.

While it might not always be possible to update your site to disable these items, clear information on why the stock shortages are occurring and how you are working to improve availability is perhaps another worthwhile addition to your website. Consider also the use of facilities such as pre-ordering, notify when available or a wish list.

If you have disclaimers in your terms and conditions, these might benefit from a review and update.  If you do not have any, consider whether any disclaimers or other ways of limiting your liability would be a wise addition at this time. Given the delays in delivery times, the longer your packages are in transit, the higher the risk of damage and so it would be advisable to add in a disclaimer to mitigate against claims for this.

How we can help

The above is not a comprehensive list and we recommend a thorough review of your existing e-commerce policies to make sure any Covid-19 policy covers anything extra and does not inadvertently contradict or eliminate key protections in your standard terms and conditions.

For further information, please contact Phil Moir in the corporate and commercial team on 0191 567 0465 or email [email protected]

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