Northern Ireland telecoms firm launches ‘Hang up on Auto-Rolling Contracts’ campaign which is costing NI firms an estimated £22.5million over the last five years
Barclay Communications is appealing to Ofcom to change the rules that allow telecommunication firms to auto renew businesses contracts for up to five years.
Belfast based Barclay Communications is launching a campaign in a bid to stop other telecommunications companies from automatically renewing landline contracts, which forces many businesses in Northern Ireland to overspend millions per year.
This is despite regulatory bodies informing telecoms firms that they must notify clients of an impending renewal in advance and in a timely manner.*
Now, Barclay Communications, which specialises in advanced communication tools, said, currently, a lack of awareness in regulations is allowing telecoms firms to automatically renew businesses into an extended contract without warning or notice, for up to five years. It says the cost to the NI business sector amounts to approximately £22.5million over the last five years.
Often concealed within the small print of contracts’ terms and conditions, businesses are required to give between 30 and 90 days’ notice to avoid their contract being extended. The below contract clause is by way of an example:
7.TERMINATION OF SERVICES
7.1 At the end of the Contract Term the Agreement will automatically continue for successive periods equal in length to the Contract Term (each such period a “Further Contract Term”).
7.2 The Customer may terminate this Agreement at any time provided that: 7.2.1 the Customer must give 30 days written notice.
Barclay Communications’ ‘Protect UK Businesses: Hang up on Auto-Rolling Contracts’ campaign comes as many businesses operate in survival mode during the pandemic. It hopes to support those businesses in maximising efficiencies and prevent them from paying out unnecessary high costs.
Britt Megahey, Founder and Managing Director of Barclay Communications, said the campaign will highlight the issue which many businesses may not be aware of. He is encouraging businesses to lend their support by signing a petition to ban the restrictive practice.
Mr Megahey, whose business supplies mobile, landline and software services to over 100,000 business end-users across the UK and Ireland as well as a host of other communication tools, said:
“Currently, the auto-rolling of fixed-line or landline contracts could be potentially costing businesses in Northern Ireland up to £5million in overspend each year. Auto-rolling is exploitative and a very real concern.
“For anyone who may not be familiar with auto-rolling, it’s when telecoms providers enter into a contract with their client for a fixed period. Within the small print of the contract the client must give anything from 30 to 90 days notice if they want to end, alter or review their contractual arrangements. This clause is rarely informed and can be difficult to spot.
“If the customer is unaware of the procedures and fails to give such notice, they are automatically rolled into an extended contract, which could be for another 60 months, depending on the supplier.
“Right now, clients feel there is no way to get out of this contract and no way to appeal the renewal. As a result, there are a lot of unhappy customers. Though it’s not just NI businesses that are being affected by the issue, it’s a UK wide problem.”
Britt continues: “At Barclay Communications we are totally opposed to auto-rolling of fixed landline contracts because it’s not in the interests of clients. Often these rollovers can last for five years and in that period advancements in technology lead to improved pricing and more compelling solutions. This is why many companies are paying outdated rates – their prices are no longer indicative of the current market as the telecoms sector is always evolving.
“We have experienced savings of over 50% for many customers and discovered that the majority have not reviewed their rates in over ten years. Indeed, some companies were not even aware that a number of the services they were paying for were not being used. This for me calls for a change.”
Britt adds: “At Barclay Communications we are committed to supporting business to have the freedom to choose their supplier and we believe that through our ‘Protect UK Businesses: Hang up on Auto-Rolling Contracts’ campaign we can lobby for the change that is needed.
“We are encouraging businesses to stand with us and make a difference by signing our online petition and by sharing their experience of auto-rolling. We need this information to showcase the severity of the problem across the business community. We will present all information to the industry regulator, The Office of Communications (Ofcom) to encourage change in these regulations.
“We are positive that our campaign can make a real difference in line with our work with Ofcom, which has shown an appetite for change on auto-rolling by implementing a ban on the practice eight years ago for smaller businesses. Now it is time to protect the larger organisations who are falling victim to the unjust process.”
Since initiating this campaign, Barclay Communications has received many calls and emails from unhappy business owners voicing their frustrations:
Geoff McCrory from Easa Group said: “I was extremely disappointed to become a victim to an automatically renewed contract. This was not only frustrating, but it also caused me a lot of time and cost.”
Declan Molloy from Molloy Fuels commented: “It was never made clear to me, nor was it ever even discussed when my contract was coming close to its end and I was inviting offers in. Our system was dated and costs in the market were lower – so you can understand my disappointment to have been entered into this against my will.”
Stephen Elliott from ESL Engineering added: “My current supplier has rolled me into a 24 month contract as I had missed the ‘correct notification period’ by a matter of five or six days out of 30. When I expressed my disappointment to my service provider, the clause was pointed out on our terms and conditions and I was informed that it was easy to negate this obligation if I signed up for a new deal with them. I had suggested that I’d be happy to consider them on fair terms alongside alternatives but couldn’t accept a new deal under force.
“I understand there is the basic protection for companies with less than ten employees but nothing for SMEs. We are a family-run manufacturer with 28 employees and don’t have dedicated departments to manage basic utilities. I was shocked that any company can legally get away with this practice and equally that they should want to. I have bluntly stated that this is the last business they will see from us.”
Sign the ‘Protect UK Businesses: Hang up on Auto-Rolling Contracts’ petition: http://chng.it/J2Dv4KyGDj
Share your business experience of auto-rolling: https://www.barclaycomms.com/help-stop-auto-renewal/