Gym members hit by shock mid-contract fee hikes

Consumer journalist Wendy Knowler says some gyms are locking members into fixed-term contracts at set monthly fees, only to hike those fees midway through the agreement – sometimes by double or triple the amount.

Consumers say these changes were never disclosed when they signed, and that the alternative (moving to other branches) is impractical. Those wanting to cancel were told they must pay a 40% penalty on the remaining contract value.

Knowler argues that this one-sided power imbalance may violate Section 48 of the Consumer Protection Act, which prohibits unfair and excessively one-sided contract terms.

She says companies shouldn’t be able to raise fees on fixed-term contracts while consumers have no matching right to renegotiate or exit without penalty.

"It's not just gyms. Cell phone companies do it as well.

"While it has to be a classic case of a one-sided contract of one company, one part of it can increase unilaterally at their discretion.

I mean, put it up by whatever you sign, you commit it, and if you want to get out, you've got to pay a massive termination penalty. I cannot for the life of me, and I'e been grappling with this Act since it was still a Bill.

"I think this is a classic case where we should push. I'm going to challenge it. That's my undertaking. Push for reform of it, or for those that are doing it to be told it's a contravention of Section 48."

To listen to Wendy Knowler in conversation with CapeTalk’s Pippa Hudson, click the audio below: