Running a small business usually means wearing a lot of hats - sales, customer service, marketing, hiring, and everything in between.
But when someone says something untrue about your business (or you say something about someone else), it can quickly turn into a legal issue that affects your reputation, revenue, and relationships.
That’s why it helps to understand the differences between slander, libel and defamation. Even if you’re not planning to “go to court”, Australia’s defamation laws shape what you can publish on your website, post on social media, say in a podcast, include in an email, or write in a Google review response.
Below, we break down the differences in plain English, explain what defamation looks like in a business context, and share practical steps to help you reduce risk and protect your brand.
What Is Defamation In Australia (And Why Businesses Should Care)?
In Australia, defamation is a broad legal concept. It’s the umbrella term that covers situations where someone publishes material about another person that harms their reputation.
For small businesses, defamation risk often shows up in everyday situations, like:
- a customer leaves a damaging review that you believe is false
- a former contractor posts accusations on social media
- a competitor spreads rumours about your products or services
- you publish a “warning post” about a supplier or ex-employee
- your team talks about a customer in a public place or online
Defamation matters because reputation is a business asset. Losing trust can mean lost customers, fewer referrals, lower conversion rates, and difficulty hiring staff or winning partnerships.
And importantly: you don’t need to intend harm for defamation risk to arise. A rushed post, an emotional reply to a review, or a casual comment in a community group can be enough.
Can A Business Be Defamed In Australia?
Sometimes, yes - but it depends on the structure and size of the business.
Under Australia’s uniform defamation laws (in each state and territory), companies generally can’t sue for defamation unless they fall within an exception (often called an “excluded corporation”). In broad terms, this tends to cover smaller, non-profit, or closely held entities (and it excludes most larger corporations).
Even where a company itself can’t sue, it may be that individuals connected to the business (like directors, founders, or key staff) can bring a claim if the publication is “about” them and harms their personal reputation.
As a practical takeaway: whether you’re protecting your business from false statements or making statements about others in the market, it’s safest to assume defamation laws may be relevant and to manage your communications carefully.
Slander vs Libel vs Defamation: What’s The Difference?
This is where people often get confused, because the words are used interchangeably in everyday conversation.
In simple terms:
- Defamation is the overall legal concept (the umbrella term).
- Slander is traditionally defamation that is spoken.
- Libel is traditionally defamation that is written or recorded.
However, in modern Australian defamation law, the old “slander vs libel” categories are usually not the main issue. The key question is generally whether defamatory material was published (communicated) to at least one other person, and whether any defences apply.
In modern business life, “spoken” and “written” can blur. A voice note, podcast clip, TikTok, webinar, livestream, or recorded customer call can raise similar issues to a written post. A comment made on camera is “spoken”, but it is also “published” to others when shared online.
That’s why, for businesses, it’s usually more helpful to think in terms of:
- Was something communicated to someone other than the subject? (published)
- Does it identify a person or business? (even if not named directly)
- Could it harm their reputation?
- Can it be proven true, or is it framed as opinion?
Slander And Defamation In Practice
Slander is often described as “spoken defamation”. In a business context, this could look like:
- telling customers that a competitor “steals deposits”
- saying in a team meeting (in front of others) that a supplier is “a fraud”
- making allegations about a client in a public setting
Even if you didn’t post it online, spoken statements can still spread quickly and cause serious damage.
Libel: Written Or Recorded Statements
Libel is commonly understood as defamation in a more “permanent” form. For small businesses, this might include:
- a negative post on Instagram, Facebook, LinkedIn, or X
- a blog article naming a person or operator and accusing them of misconduct
- an email to a group of customers claiming a former staff member is dishonest
- a public response to a review calling the reviewer a liar or scammer
If your business records calls, meetings, or training sessions, it’s also worth understanding your broader legal obligations around recording. The rules can vary by location and circumstances, so having a clear policy helps - and it’s also wise to check the rules before relying on recordings in a dispute. (You may also want to review business call recording laws if recording is part of your customer service process.)
What Actually Counts As Defamation? Key Elements For Businesses
Defamation law can be complex, but Australia has largely uniform defamation legislation across states and territories (with some differences in how it’s applied in particular situations). From a small business perspective, there are a few recurring elements that commonly matter when assessing whether a statement creates legal risk.
1) The Statement Was “Published”
In defamation, “published” doesn’t mean you wrote a book. It simply means the statement was communicated to at least one other person (other than the person it’s about).
That can include:
- a post in a local community Facebook group
- a message in a group chat
- an email sent to multiple recipients
- a customer conversation overheard by others
2) The Person Or Business Was Identified
A statement can be defamatory even if you don’t name the person directly, as long as people can reasonably work out who you mean.
For example, “the cafe on the corner of Smith St” or “that tradie who did the bathroom reno last month” may still point to a specific operator.
3) The Statement Could Harm Reputation
Defamation generally involves statements that lower someone’s reputation in the eyes of ordinary people.
In business terms, this usually means accusations like:
- fraud, theft, dishonesty, scamming customers
- unsafe or illegal conduct
- professional incompetence (especially where trust is critical, like health or finance)
- serious misconduct or unethical behaviour
4) It Was Not Protected By A Defence (And It Met The “Serious Harm” Threshold)
Defamation law includes defences that can apply in certain situations - for example, if what you said was substantially true, or if it was an honest opinion based on proper material.
In addition, since reforms introduced in 2021, a plaintiff generally needs to show the publication has caused, or is likely to cause, serious harm to their reputation (and for businesses that can sue, serious financial loss). This means not every unpleasant or unfair comment will necessarily meet the legal threshold.
This is a major reason why businesses should be careful with wording. A statement framed as a fact (“they stole my money”) is different to an opinion (“I was unhappy with the service because my job wasn’t completed”).
Even then, “it’s just my opinion” isn’t a magic phrase. The context, supporting facts, and how it’s presented will matter.
Common Defamation Risk Areas For Small Businesses (And How To Manage Them)
Most defamation issues for small businesses don’t start with a formal media campaign - they start with day-to-day communications and a situation that escalates.
Here are some common risk areas, plus practical ways to reduce the chance of a dispute.
Online Reviews And Your Responses
Reviews are a normal part of business. The risk often arises in how you respond when you feel a review is unfair or untrue.
Practical tips:
- avoid calling the reviewer a liar, scammer, or fraudster
- respond with calm, factual information (dates, policies, what you offered)
- invite them to contact you privately to resolve the issue
- keep internal notes and evidence in case you need to escalate later
If the review looks fake or malicious, it’s worth considering a structured approach to getting it removed or challenged. (This often overlaps with broader strategy - for example, handling fake Google reviews can involve platform processes and careful legal positioning.)
Social Media Posts, Stories, And “Warning Others”
It can be tempting to post a “buyer beware” warning when you have a bad experience with a supplier, contractor, or customer.
But posts like this are high-risk because they’re public, shareable, and often written when emotions are high.
If you need to communicate a problem publicly (for example, a product recall or a safety concern), aim to:
- stick to verifiable facts
- avoid exaggeration and inflammatory labels
- avoid naming individuals unless genuinely necessary and legally appropriate
Marketing Claims About Competitors
Another common trap is comparative advertising - especially when you’re trying to stand out in a crowded market.
Statements like “we’re the only honest provider” or “our competitor uses illegal methods” can create defamation risk, but they may also trigger issues under consumer law if they mislead consumers.
As a rule, if you’re making claims about your business (or someone else’s), you should be confident they’re accurate and can be supported. It can also be helpful to understand the elements of misleading or deceptive conduct so your marketing stays on the right side of the law.
Internal Communications (Staff, Contractors, And Group Chats)
Defamation risk isn’t limited to public posts. It can also arise in internal messages that spread beyond the original audience, such as:
- team Slack/Teams messages
- group chats about a difficult customer
- emails discussing alleged misconduct
To manage this, you can set expectations through workplace policies and training, and you should also have solid contracts in place with staff.
Even if defamation isn’t the main focus, a clear Employment Contract can help you set behavioural expectations and reduce disputes when things go wrong.
What To Do If Your Business Is Being Defamed (A Practical Action Plan)
If someone has made harmful statements about your business, it’s natural to want to respond immediately.
But the first steps you take can either contain the issue or escalate it. Here’s a practical approach we often recommend businesses consider.
1) Don’t Respond In Anger (And Don’t “Clap Back” Publicly)
A quick public response can feel satisfying, but it can also create more legal exposure - including exposing you to a counterclaim if your response contains allegations about them.
Instead, pause and gather the facts.
2) Preserve Evidence
Take screenshots, copy URLs, save emails, and keep records of:
- what was said
- where it was published
- when it was posted
- who engaged with it (comments/shares if relevant)
If it’s content that might be deleted later, preserving evidence early is important.
3) Assess The Impact On Your Business
Think about practical harm, such as:
- customers cancelling bookings
- a drop in leads or online conversion
- damage to a key relationship (landlord, supplier, strategic partner)
This helps inform what a reasonable response looks like.
Depending on the situation, you might ask the person to remove the content, publish a correction, or stop repeating the claims.
In some cases, a formal letter can help draw a clear line and show you’re taking the issue seriously. For example, a cease and desist letter may be appropriate where ongoing publication is causing harm (and you want a documented request to stop).
5) Be Careful With Recordings And “Proof”
Businesses sometimes want to rely on recordings (calls, meetings, CCTV audio) to “prove” what happened.
Before using recordings, make sure you understand your legal position and obligations. This is particularly relevant if you recorded phone calls - the rules can vary depending on where you are and what consent was obtained. If call recordings are part of your customer management, it’s helpful to check whether your practices align with Australian recording laws.
6) Get Advice Early
Defamation disputes can move quickly, especially online. Getting advice early can help you choose a response that protects your business (and avoids accidentally creating new risk).
How To Reduce Defamation Risk In Your Business Communications
Even if you’ve never dealt with a defamation issue, it’s worth setting up practical guardrails now. This is especially true if your business is active online, runs marketing campaigns, has customer support teams, or manages public-facing community channels.
Use Clear Templates For Public Communications
For example:
- review response templates that are calm and factual
- complaints escalation scripts for staff
- social media community rules (what you will remove and why)
If your team regularly communicates by email with customers and suppliers, it can also be helpful to standardise an Email Disclaimer - not as a cure-all, but as part of building consistent communication practices.
Train Your Team On “Facts vs Allegations vs Opinions”
A practical way to think about it:
- Facts: things you can prove (dates, amounts, what was delivered)
- Allegations: claims you believe, but can’t prove yet
- Opinions: views based on disclosed facts (“I felt the service was poor because…”)
Encouraging staff to communicate with this framework can prevent the most common defamation mistakes.
Be Careful When Sharing Customer Stories Or Case Studies
Marketing case studies are powerful - but if a customer story identifies someone (even indirectly) and includes negative claims about them or another provider, it can create risk.
Also, if you collect and publish personal information, you should ensure your business has an appropriate Privacy Policy in place and that your marketing practices match what you say you do.
Remember That “Private” Channels Can Become Public
Group chats, internal emails, and private messages can be forwarded or screenshotted. As a practical rule, encourage your team to write messages as though they could be seen by an external party later.
Key Takeaways
- Defamation is the umbrella term, while slander (spoken) and libel (written/recorded) are traditional categories - but in Australia the focus is usually on whether defamatory material was published and whether legal thresholds and defences apply.
- When comparing slander vs libel vs defamation, focus on whether the statement was published to others, identifies a person/business, and could harm reputation.
- Small business risk areas include review responses, social media posts, competitor comparisons, and internal team communications.
- If your business is being defamed, preserve evidence early, avoid emotional public replies, and consider a structured approach (including takedown requests or formal letters).
- Clear templates, team training, and consistent business documents (like employment contracts and privacy policies) help reduce the chance of disputes escalating.
If you’d like help managing defamation risk (or responding to damaging statements about your business), you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
