EE, among other major mobile network providers, will be raising the costs of their contracts, for customers that have taken contracts out from March 2014! This isn’t the only sector of society that change contractual agreements at the cost of the consumer. Increases to student finance agreements mid-contract have already stung many students and graduates, and this leads to the question of whether it is ethical for businesses to be able to operate in this way.
Were consumers made aware?
EE states that the potential to increase their rates ‘in line with the RPI’ is outlined within their terms and conditions when customers take out contracts with the provider. This is surely a bit of a grey area, as OfCom states that consumers have the right to cancel contracts if price increases were not made clear to the customer at the point of sale. They even provide guidance to providers on how to outline this without ‘material detriment’ to the customer or business they are providing a service to.
Their belief is customers should be given one month’s notice of the increase and be allowed to exit the contract without penalty, if a provider wishes introduce any subscription increase to an already-agreed contract. The grey area is that by placing this information in small-print, providers can defend themselves with the notion that this information was put to the customer at the point of sale.
Should it not be made explicitly clear?
In the culture of privacy agreements and T&Cs, the amount of information that is ‘provided’ to the customer, versus how informed the customer actually is about the terms of their agreement has always been subject of controversy.
A statistics once came out that highlighted the length of time it would take the average reader to complete Apple’s privacy agreement. It would take the average reader around three months to complete, which is already 12.5% of the contract itself! If the terms within the agreement were something providers wished to make explicitly clear to consumers, there are many ways in which they could do this.
What can people do?
As it stands, unfortunately consumers can do very little. At most you can write a strongly worded letter to your provider, and consider withdrawing yourself from their services down the line. You will not be able to leave your contract without early termination fees however, as on paper the provider in question has operated within the brackets of the law.
Although regulators are fighting to change this, the key advice here is to ask your provider at the point of sale about any potential increase to fees mid-contract. Finding this out years down the line will mean that for those who budget to live pay-to-pay each month, even a small variation in their bills could send them into negative equity, arguably only decreasing their ability to maintain future payments.