Helena lives in Toronto and received a Facebook invitation: one free class at the same gym where the models and movie stars usually go!
When she arrives at the gym, Helena will certainly need to sign a waiver for the free training, which she will have to fill with her personal information. Once the training is over, the gym will ask her for her feedback about the class. From a marketing perspective, Helena’s chances to say “not interested” or “I do not want to hear more about it” are unlikely.
The gym has two tools to get Helena signed in: a contract and a price list. There will be no negotiation: if Helena wants to bring the contract at home, the gym will never provide her a copy because if Helena signs the contract she will have 10 days to cancel it. These 10 days of “cooling off” entitle Helena to change her mind after signing and cannot be assumed as the reasonable amount of time that she needs to be informed, carefully read and accept the contract.
Is it education or a workout?
Nowadays, sports clubs, martial arts, dance classes and gyms contracts are deliberately varying their contracts from “personal development services” to “student tuition agreements”. Why?
This is simply because “personal development services” are carefully regulated by the Consumer Protection Act (sections 29-36) and Consumer Regulation Act (Sections 27-30) while “student tuition agreements” could be open to interpretation by the business.
These two contracts have substantial differences: student tuition agreements can be easily renewed for more than one year and could reduce the required amount of information provided to consumers.
Personal development services require gyms to provide reasonable use of their premises and equipment and a student tuition agreement does not even consider this. Also, the enforceability of the full term payment is stronger under the student tuition agreement.
Are credit cards required?
Not all gym contracts will insist on mandatory payments by credit card. However, many gym managers tell customers that a credit card is required in order to enrol into the program.
Connecting the contract to a credit card will easily reduce the consumer to a 100% loyal customer for the whole term of the contract, including automatic renewals and late fees. Moreover, connecting the contract to a credit card may allow unscrupulous gyms to charge two months in advance by fixing the payment dates.
Why a fixed payment dates system?
The gym wants to standardize its financial monthly income by charging a credit card at the beginning of each month. It does not matter when Helena enters into the contract: charges will always be sent on the same date.
The fixed dates` mechanism can be tricky for the consumer because the signing day is on the same date that the free training class has been received. In essence, that free class is not free anymore because Helena will be charged the enrolling fee plus the first month on that date.
The second payment will not start 30 days after the free class but on the fixed date by the gym (usually at the beginning of the following month).
What are my rights as a consumer?
The Consumer Protection Act does not apply to the following types of gyms:
- A not-for-profit or charitable organization (e.g. YMCA.)
- Owned by its members or through a cooperative
- Run by, or funded by, a municipal organization or by the Province of Ontario or any of its agencies (recreation centres)
- An incidental service as part of other goods or service supplied to you (e.g. visiting a spa, which has fitness facilities)
Information and cooling off period: consumers have the right to be informed of the terms of the agreement, to carefully read it before signing it. That information right includes the chance to get a copy from the gym. However, the consumer has to ask the gym to provide him or her copy of the agreement as a condition for acceptance. Once they have accepted and signed the agreement, they have 10 more days to repent and cancel it. These 10 days are extra called the cooling off period.
Limit on initiation fees and payment of personal development agreements: the total amount of the initiation fees cannot be more than twice the total annual membership fee. If membership is paid in monthly instalments, it can only be 25% more than if the total would be paid up front.
Gyms will make renewals automatic: personal development agreements require they send a renewal notice at least 30 days but not more than 90 days before the expiration date. This notice is usually sent in a form of a new promotion that even if it is not accepted by the consumer it will considered a valid notice.
Gyms have to guaranty their service by ensuring the fitness equipment, enough room to practice, premises cleaning and acceptable quality, otherwise the contract can be cancelled by giving notice.
Going to the gym requires the strength and desire of working out both the body and the mind!