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16feb opinion working out unfair terms hero2
5 February 2016

Opinion: Working out unfair terms

We’ve taken a good look at gym contracts.

I’m one of those annoying gym members who regularly works out. I’ve been a member of the same gym since it was acceptable to jump up and down in bare feet and Lycra was on the cusp of being dreamed of. It’s a national chain so when I move my membership travels too. That’s a true benefit for me.

What’s not so rosy are the other terms and conditions of membership. For instance, the gym can terminate my membership if I fail to pay my monthly fee on the due date, even if it’s just a day late. It claims it wouldn’t, but that’s not what its rules say.

As part of our campaign against unfair contract terms, we’ve taken a good look at gym contracts. If I were a personal trainer, I’d rate them as flabby, out of shape, and overdue for an overhaul.

Probably the most overbearing are cancellation terms. At one gym, membership can only be cancelled by completing the club’s form at the counter, which then needs to be countersigned by the manager before taking effect. Routinely gyms require 30 days’ written notice of cancellation, some include a clause saying your cancellation won’t take effect until the gym says so.

Many gym contracts also attempt to limit or exclude liability for almost everything. These types of terms are broadly drafted and are likely to be unfair and risk misleading consumers about their rights to reasonable standards of service.

Unfair contract terms in the Fair Trading Act are defined as conditions that would cause a significant imbalance between the rights of the company and the consumer, they are not necessary to protect the legitimate interests of the company, and would cause detriment to the consumer if they were relied on.

Unfair gym contracts are not unique to New Zealand. Regulators overseas have said long-term gym memberships that don’t allow members to cancel if their circumstances change, such as suffering an injury or losing their job are likely to be unfair. As are tricky cancellation terms.

We’ve raised our concerns with some of the biggest gyms. You can read their response here. The Commerce Commission is also in discussions with them. Unfair contract terms are not the first things that come to mind when you sign up for a gym. Especially at this time of year, when many people are looking to relieve themselves of their Christmas and New Year excesses.

Unfair contract terms have been banned since March last year. But who goes through the fine print looking for them? That’s where we come in – to do the workout for you. But you can help by joining the campaign. If you’ve been given a contract you think contains an unfair term, let us know at [email protected].

About the author:

Sue Chetwin has been our Chief Executive since April 2007 after more than 25 years in print journalism. She was formerly the Editor of Sunday News, Sunday Star Times and the Herald on Sunday. She says there are strong parallels between consumer advocacy and journalism.

Sue oversees all of Consumer’s operations and is also the public face of the organisation. Sue is a director of the Banking Ombudsman Scheme, an alternate on the Electricity and Gas Complaints Commission and a member of the Electricity Authority Retail Advisory group.

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