Responsible selling is a key focus of proposed revisions to the Telecommunications Consumer Protections (TCP) Code made by peak body Communications Alliance.
This would include new rules for telcos around sales including seeking customer feedback and satisfaction scores, limits on sales commissions and enforcing action against businesses that mis-sell.
Where mis-selling occurs consumers will need to be made aware of their right to a refund. Customers would also need to be better informed of how cancelling a service may affect other services, for example, when a customer cancels their phone plan and would then need to pay out the remaining cost of their handset.
Telco complaints have reached historic lows since 2004, but Telstra and Optus have come under fire in recent years for "unconscionable" sales practices.
In October, the ACCC commenced Federal Court proceedings against Optus. It alleges Optus disproportionally impacted vulnerable customers, selling plans consumers didn't want or need and then in some cases going after customers for debts resulting from those sales. Optus has apologised for this, is working to provide refunds to affected customers, and new CEO Stephen Rue has launched an internal review.
Telstra paid $50 million in penalties in 2021 after the Australian Federal Court found the telco engaged in unconscionable conduct by selling postpaid mobile contracts to more than 100 Indigenous customers who did not understand and could not afford the plans they were signed up to.
The TCP Code outlays the rules by which telecommunications companies that provide mobile phone, landline and internet services to consumers with regards to communication, how plans are advertised, billing and disputes and other consumer matters.
Other major proposed changes to the TCP Code include:
- All Carriage Service Providers (CSPs) to register with ACMA. This would enhance ACMA's ability to enforce industry Codes and Standards.
- Fee-free payment methods. Customers must have access to at least two fee-free payment options, one of which must be manual.
- Protections for vulnerable consumers. New clauses included in the proposal would require telcos to better identify customers in vulnerable circumstances, better manage deceased customers' accounts and strengthen accessibility requirements.
- Training and auditing for telco staff. This would include annual training for staff company-wide on obligations to consumers.
Collectively these changes would see the Australian Communications and Media Authority (ACMA) granted greater powers to take action against breaches of the TCP Code.
Comms Alliance CEO Luke Coleman said, “[The TCP Code] is a safety net above a safety net, enforced by two regulators with strong enforcement powers – ensuring the industry is held to the highest standards. Additionally, every telco’s adherence to the TCP Code is independently audited annually by Communications Compliance, complementing the monitoring and auditing powers of the ACMA."
A statement released by the ACMA welcomed the proposed changes. It said, "The ACMA considers that it is critical that remaining elements of the Code provide consumers with confidence that the industry will meet their expectations in regard to selling practices, account management and customer service and support."
Consumers who have been unable to resolve an issue with their telco can escalate complaints to the TIO. Switching to another provider has also never been easier, for example, consumers can switch NBN plans in just a few minutes with little to no downtime. A survey conducted by Whistleout of 2,000 people found 43% of Australians haven't changed their internet plan in three years, potentially missing out on hundreds of dollars in savings.
The revised TCP Code is available for public consultation, with submissions closing on February 28, 2025.
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