Broadband and landline users to get automatic compensation for poor service

Ofcom says new scheme could result in customers receiving a total of £142m a year in payouts

Telecoms companies have not always kept pace with customers’ needs when it comes to quality of service. Many people are not getting the standard of service they expect, or being adequately compensated when service falls short.

So, Ofcom set out plans for people to be compensated automatically by providers for slow repairs, missed appointments and delayed installations. This means credit on a customer’s account – without having to ask.

As a result of Ofcom’s intervention, BT, Sky, TalkTalk, Virgin Media and Zen Internet – who together serve around 90% of landline and broadband customers in the UK – have agreed to introduce automatic compensation, which will reflect the harm consumers suffer when things go wrong. This is how it will work:

Launching the first ever automatic compensation scheme for telecoms customers will be complex, and requires significant changes to providers’ billing systems, online accounts and call centres. So, there will be a 15-month implementation period before it comes into effect to ensure a smooth introduction. Consumers currently experiencing problems can find advice on Ofcom’s website on what to do if they are unhappy with the service they receive.

Lindsey Fussell, Ofcom’s Consumer Group Director, said: “Waiting too long for your landline or broadband to be fixed is frustrating enough, without having to fight for compensation.

“So, providers will have to pay money back automatically, whenever repairs or installations don’t happen on time, or an engineer doesn’t turn up. People will get the money they deserve, while providers will want to work harder to improve their service.”

Helping small businesses

Around one third of small and medium-sized enterprises (SMEs) choose residential landline and broadband services, and so will also benefit from the compensation scheme.

Also, many standard business contracts already provide compensation for some problems. However, we found that around half  of SMEs did not know if they were entitled to compensation when service falls short.

Therefore, Ofcom is introducing new rules to ensure all SMEs are given clearer, more detailed information up front about what service quality to expect. This includes whether they can claim compensation when problems occur.

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