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Cotton On cops $1 million fine for flammable nightdresses

Cotton On is in trouble with the authorities yet again, with the retailer now fined a massive $1 million for selling children's sleepwear that was deemed so flammable it shouldn't have even been supplied.

But this is just the latest incident involving the company and regulatory authorities, with Cotton On having been at the centre of a number of controversies over the past few years including advertising bungles and even an underpayment scandal.

The move also comes just as the business is beginning to really hit its stride, recently announcing an expansion of its Geelong headquarters and 500 extra jobs.

In a judgment handed down by the Federal Court, Justice Tracey said the company supplied nightwear between September and December 2010 that was so flammable it shouldn't have even been sold in Australia.

Australian Competition and Consumer Commission deputy chair Delia Richard added the incident was magnified by the fact the nightwear was labelled "low fire danger".

Justice Tracey said the serious nature of the consequences weighed in favour of a large penalty, noting the target consumers were particularly vulnerable. Tracey also said the responsibility for compliance was with the senior managers, who "manifestly failed to comply with this important aspect of their duties".

Cotton On was contacted by this morning, but no reply was available before publication.

This isn't the first time children's wear has fallen within the sights of the consumer watchdog. More recently, discount chain Dimmey's was fined for selling unsafe material.

This is a massive fine for Cotton On, which is known for its controversial marketing and edgy advertising. To Cotton On's credit, the ACCC said the company voluntarily recalled the products and co-operated with the authorities throughout the investigation.

This article was first published on SmartCompany.

Myriam Robin

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Myriam Robin is a reporter for SmartCompany and its sister site LeadingCompany. She has degrees in economics, international studies and journalism. She likes writing about businesses taking risks and doing new things.
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