By Daniel Hunter
Bannatyne Fitness Limited, David Lloyd Leisure Limited and Fitness First Clubs Limited have agreed to change their contract terms to make them more transparent and give their members better cancellation rights, following an Office of Fair Trading investigation.
The three health and fitness club operators, with almost a million members between them, co-operated with the OFT's investigation and have given undertakings that they will no longer use contract terms or practices considered unfair by the OFT. Specifically the OFT has secured:
- extended rights for members to cancel their contracts early should their circumstances change in a way that makes attendance at the gym difficult or unaffordable - for example if they lose their jobs or suffer an injury
- a commitment not to describe membership as being of a fixed duration, if the contract automatically continues on a rolling basis after the initial membership period has expired
- greater transparency about key membership features, including initial membership periods and cancellation rights, and for these to be provided upfront as part of the sales process.
"Millions of people are members of gyms and a membership contract can easily be a financial commitment of over £500 per annum. We were concerned that contracts could unfairly lock people in if their circumstances changed - forcing them to continue paying even if they had lost their job," Cavendish Elithorn, Senior Director of the OFT's Goods and Consumer Group, said.
"We welcome these changes from Bannatyne's, David Lloyd and Fitness First. As well as making contract terms clearer, the revised contracts also grant members, and prospective members, more flexibility.
"Meanwhile, we are continuing our investigation into some other companies in the sector and will provide an update in the coming weeks."
The OFT launched its investigation after a previous High Court ruling against a gym management company found lengthy gym membership periods can be unfair when they lock people in without adequate cancellation rights when their circumstances change. The OFT had concerns that others operating in the sector might be using similar unfair contract terms.
The OFT is also reminding people to carefully consider the terms of the contract before they take out a membership at a gym or health club, be willing to shop around and find out what their options are if they want to cancel their membership. The OFT recently issued a consumer alert advising people of their rights.
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