/ Money, Technology

Orange puts its prices up – so why can’t you cancel?

Orange is hiking its pay monthly price plans by 4.34%. And not just for new customers – existing customers will get hit too. It doesn’t stop there – Orange won’t let you cancel your contract. Is that fair – or legal?

This morning we were alerted to Orange’s price rise announcement by an email from Aaron. He had been sent a brief text from the mobile phone network, but couldn’t quite believe it was allowed to put prices up for existing customers:

‘I do not believe that it is fair of a corporation to change the price of a contract that I signed up to, as my phone bill was essentially “fixed” every month.’

Why can’t you cancel your contract?

Orange blames the rise on inflation hitting a 20-year high, adding that this is ‘having a significant impact on business and households alike’. But Orange won’t have to suffer, instead it will simply pass the cost onto its customers:

‘Unfortunately, we’ve had to re-evaluate our prices for the first time and are sorry to say that there will be a 4.34% increase in our monthly plan prices from 8 January 2012. This is lower than the Retail Price Index (RPI) measure of inflation, which currently stands at 5.4%.’

So if you’re on a monthly price plan with Orange (and signed up to your current contract before 1 September) watch your bills go up by more than 4% next year.

The real kick comes from Orange saying you won’t be able to cancel, as Kimberly Harwood (@kimberlyharwood) told us on Twitter:

‘Can’t cancel my contract as the rise is ‘within their terms and conditions’ disgraceful! Won’t be renewing.’

Ultimately, you’re locked in. In section 4.3 of the contract, Orange states that although you’re able to terminate if it makes certain changes to the terms of your contract, you’ll be unable to do so if it puts prices up at a rate lower than the RPI measure of inflation.

Is Orange playing by the letter of the law?

I’m getting deja-vu from the T-Mobile saga, where that mobile network slashed the data allowance for its existing customers. How can it be right that a company can change the payment terms of your contract when you’re already signed up?

Is Orange behaving legally? It seems that it probably is. Our lawyer Peter McCarthy told us that Orange’s T&Cs would stand unless it could be successfully challenged as ‘unfair’.

The Unfair Terms in Consumer Contracts Regulations 1999 says a clause is likely to be unfair if it allows ‘a seller […] to increase their price without […] giving the consumer the corresponding right to cancel the contract if the final price is too high in relation to the price agreed when the contract was concluded’.

Ultimately, the success of any such challenge against Orange would depend on whether the increase was considered to be significant or not.

Ofcom cites material detriment

We also got in touch with the regulator Ofcom, to see whether you should have the right to terminate your contract with Orange. It told us that customers will only be able to cancel if the changes are likely to be of ‘material detriment’ (as per Section 9.6 of the Communications Act 2003) which in this particular case, Ofcom was unable to verify.

However, you do have the right ‘to challenge the matter through the provider’s complaint process and, failing that, via Alternative Dispute Resolution.’

Nevertheless, even if Orange is playing by the book, is it being fair to its existing customers? Should companies be able to change prices mid-way through your contract, even if it has allowed itself to do so in the small print? And finally, will you stick with Orange when your contract comes up for renewal? Somehow I doubt it.

Comments
James says:
22 November 2012

Mihai: yes, we all read that a year ago. Ofcom still did nothing. I left orange and have a much better deal and better coverage on Vodafone

Jason says:
23 November 2012

As posted earlier myself and my girlfriend canceled our contract with Orange and the customer rep was a complete t**t when we refused all his offers to stay with Orange. A few days later we have both started to receive endless spam about PPI and other rubbish, texts and phone calls

Coincidence, hmmm i don’t think so!! Orange you really are a low life f**cking piece of sh*t company, who can go f**k themselves.

I think that sums up how we both feel about Orange, rather nicely

Kenny Taylor says:
9 March 2013

Absolutely disgusted with Orange (EE) for this legalised theft from existing “loyal” customers. Legal or not it is morally wrong to sign people up to years of fixed contracts then raise pass on price rises. Surely if price rises only applied to new customers then these people could actively choose to accept these prices. I and hopefully every other cash cow for the orange short sighted profiteers will not be re mewing my contract at term end…
The 3network is the way forward, I know plenty of people on it and sing their praises as to handset choice,,, price plans,,, and content of contracts. 1 year left with these thieves so if £0.99p per month equalling less than £12 on the remainder of my contract means orange will gamble with my continued loyalty they will lose the hundreds of pounds from my lack of loyalty to them.

Glad to say I am no longer with orange since my contract ended in Jan…..Didn’t need a new phone so got a good deal on virgin sim only fixed £12 a month….unlimited text,1200 mins and 1mgb web and no contract just 1 months notice if you want to leave them, saving £16 a month now and have got more than what orange was giving me.

Adam Airey says:
28 April 2013

I’ve been with Orange since the dawn of time, my first mobile phone was with them and so now this phone will be my last!

Loyalty obviously means nothing to this company!

shaukat says:
30 April 2013

Both myself and my sister have moved from Orange, for the exact same reason, she was out of her contract but i bought my self out of mine as there was only 3 months left on it before the price rise as refused to pay it, hopefully it was a wise decision as its not always greener on the otherside, at this stage its red on the otherside as i have moved to Vodafone. Hopefully one day fixed will mean fixed and unlimited means unlimited (rather than terms and conditions apply).

BK says:
8 April 2014

Orange say my contract will increase by RPI which they say is 2.7%,i will be changing provider when contract expires unless they respect customers of more than 20 years standing.

GSP says:
8 April 2014

Disgusted.
From the EE letter “RPI is a measure of inflation, which directly affects the cost to run our service”
Well guess what idiots, RPI directly affects the cost of running my household!
You are a business- improve your operations and efficiencies. Do not just pass directly onto customers. This is a sign of a weak company.
No way will I be renewing my contract with Orange / EE.

Best thing I did was to get shot of Orange15 months ago when my contract came to the end, been with Virgin SIM only fixed price and no contract best decision ever.

Lynn C says:
22 April 2015

I am disgusted at the bully boy tactics AND confusion being deployed by EE. I am also very confused as to exactly how much this price plan increase will cost me. I received a text from EE stating “your monthly price plan will increase by 0.9% in line with the most recently published RPI.” It then gave me the link for the website that explains this and enables you to calculate the new monthly plan cost. But on looking at that page, and other pages from EE and Orange, the increase given is far more, at 2.7% ! See: http://ee.co.uk/help/add-ons-benefits-and-plans/price-plans-and-costs/ee-price-plans/what-the-2014-ee-price-changes-mean-to-you
I am totally confused and don’t even know how to challenge them on this, unless calling them and speaking to someone in a foreign country who never seem to understand us nor we them!
I am also going to be penalised unfairly here by its increase because when I threatened to leave Orange a year or more ago because they had altered my contract and made changes that would cost me more money every month, they offered me a plan for £21.50 a month. On telling them there was no way I was going to pay that much more than I had been paying for an identical service. Finally a manager agreed I could have the plan at a cost of £16.50, but I had to pay the £21.50 a month and they would, he said, reimburse me £5.00 each month. So, this price increase (whatever percentage it is going to end up being!) is going to be charged to me on the figure of £21.50, not the £16.50 I actually end up paying! All this is capped off with the fact that since converting to EE my orange signal has been terrible, dipping down and going to nothing for the majority of the time and without even moving the phone! I am going to have to find out when my contract expires and look up other providers and price plans with a view to getting away from these robbers completely!