Is your gym treating you unfairly? Our review found gym contracts can be peppered with terms that risk breaching the Fair Trading Act.
Since March 2015, the Act has banned unfair terms in consumer contracts. But our review found some gyms are at risk of breaching the ban. The Commerce Commission is also looking at gym contracts in light of the law change.
“30 days’ notice” clauses
Sign-up for a 12-month gym membership and you reasonably expect it to end after 12 months. However, contracts can give gyms the right to keep charging fees until you give 30 days’ written notice to cancel. We think these notice periods are unfair. You should be able to end payments easily when the membership term ends.
The contract shall continue indefinitely after the minimum term until a request to terminate is made. There is a notice period of 30 days during which time any payments that fall due must be paid – Debitsuccess contract for Configure Express
“It’s not over ’til we say” clauses
Some gym contracts have a clause stating your request to cancel won’t take effect until the gym confirms it in writing. Any delay by the gym means you’ll be stuck paying membership fees. Other contracts require members to use a prescribed form to cancel. These clauses aren’t necessary and risk unfairly penalising gym members.
Membership may be cancelled by completing the club’s cancellation form. This form must be filled out over the counter at the gym and countersigned by the manager before taking effect – Snap Fitness
“Services may change” clauses
Gym contracts can restrict members’ rights to cancel, even if the gym changes its services or location. The contract says you have to keep paying fees regardless. Few contracts allow members to cancel if their circumstances change – for example, you suffer an injury or become unwell.
The gym reserves the right to change, alter or adapt timetables, facilities or location at any time. Suspension of your membership is at the gym’s sole discretion – Habit Health & Fitness
“Don’t blame us” clauses
Many gym contracts attempt to limit or exclude the gym’s liability for problems. These types of terms can be broadly drafted, excluding responsibility for almost everything. They’re not only likely to be unfair but they also risk misleading consumers about their rights to reasonable standards of service.
The member releases the company and its employees, contractors and agents from all liability and responsibility whatsoever, for personal injury, property damage or death however caused including, but not limited to, the negligence of the company or its staff or any other person using the premises – Exodus Health & Fitness Club
“You’re out” clauses
Gym members may have limited rights to cancel but most gyms reserve their rights to terminate contracts in a variety of situations, including for minor slip-ups such as paying fees a day late. However, it’s hard to find a contract that penalises the gym for making any slip-up.
We can terminate your membership immediately by giving you notice in writing, if you breach any important term of this contract, including failing to pay any fee on the due date – Les Mills
Debitsuccess, which manages memberships for Configure Express, Club Physical and other gyms, says it’s in discussions with the Commerce Commission about its standard terms and conditions. Debitsuccess head of group compliance Brian Garrity says it intends to address the issues we’ve raised.
Exodus Health & Fitness Club and Habit Health & Fitness said they would review their contracts if there were concerns about any terms.
However, Les Mills doesn’t believe terms in its contract are unfair. While the contract gives the gym the right to end a membership if “any fee” isn’t paid on time, the company's head of finance Peter Murray says it wouldn’t do this for “odd late payments”. We think the contract should be amended to reflect the gym’s practice and be fairer to members.
Snap Fitness didn’t respond to our inquiries.
Fight unfair terms
If you’ve been asked to sign a contract you think is unfair, you don’t have to put up with it. Tell the gym you think it’s not playing fair and make a complaint to the Commerce Commission. Here are some sample letters to help you.
The Fair Trading Act defines a term as unfair if it:
- would cause a significant imbalance between the rights of the company and the consumer,
- is not reasonably necessary to protect the legitimate interests of the company, and
- would cause detriment, whether financial or otherwise, to the consumer if it were to be applied or relied on.
What to look for
If you’re joining a gym, fair contracts should:
- Let you end your membership easily when any minimum term ends. If you need to cancel the contract early, any cancellation fee should be fair.
- Let you end your membership if your circumstances change, for example, you become unwell or are suffering financial hardship.
- Require the gym to notify you of changes to services and let you cancel if the changes disadvantage you.
- Provide for membership fees paid in advance by lump sum to be refunded in the event you or the gym cancels the contract.
- Provide fair processes for dealing with complaints.