New regulations give students new rights for direct redress

The relationship of students vis-à-vis the educational institutions they attend is rarely thought of in the first instance as that of a consumer and trader. However, in truth, students are indeed viewed under the law as consumers of the services provided by such educational institutions and, as a result, are covered by the rights contained in the consumer regulations.

In August this year, new draft regulations were published by the Department for Business, Innovation and Skills (BIS) with regard to consumer protection. One of these, The Consumer Protection from Unfair Trading (Amendment) Regulations 2013 (the Regulations), should be of particular interest to colleges. As well as tightening up the existing regulations protecting consumers, the regulations specifically provide for direct civic redress in cases of aggressive or misleading practices. This means that whereas previously any enforcement action by consumers could only be taken through the Office of Fair Trading (OFT), the Regulations now afford consumers the opportunity to obtain direct redress from traders.

On experiencing either misleading or aggressive practices, which is the trigger, the consumer now has a number of new remedies available to them. First, they have the option to “unwind” an existing contract with a supplier and reject the goods within a period of 90 days, provided the products of services have not been fully consumed. Even if the right to unwind the contract has expired, there is a further remedy available to consumers whereby they can obtain a discount from the trader in the event that they have elected to keep the rest of the goods and payment, or part payment, is still owed. Finally, consumers would be entitled to damages if they can prove that the aforementioned misleading information or aggressive behaviour caused economic loss, distress or inconvenience.

In terms of educational institutions, the OFT recently launched a “call for information on the provision of undergraduate higher education in England by universities and other institutions”. The OFT is looking to understand whether universities are competing effectively and whether they are meeting students’ expectations. In addition, they are interested in matters such as what courses are being offered and how they are delivered, and whether students have the necessary information to enable them to make properly informed choices.

In light of these concerns, the regulations are of particular importance. Students would now have a right to either a full refund or a discount if, for example, they felt that their reasonable expectations as to what a given course would provide were not met due to misleading information on the part of the university or college. Even if the institution could absorb the financial cost arising out of such a claim, the knock-on effect of possible bad press and consequent risk to reputation could severely affect future student recruitment and, by extension, profit, a cost far greater than that of the claim itself. This is a considerable risk which institutions should take into account.

Higher education institutions must therefore be vigilant in the marketing and advertising techniques they employ and ensure that they are not misleading or aggressive, but are instead clear and accurate in terms of the information they provide. This may manifest itself in terms of what information appears on the institution’s website or brochures, for example, and what message it carries.

Besides the information and marketing aspect, institutions of higher education must also ensure that the actual service they deliver is in line with what can be reasonably expected. With a wide variance between institutions in terms of how much teaching time is spent on a particular subject, this could also be grounds for student dissatisfaction. A good way to combat this is by providing openly available information on exactly what students can expect to receive in terms of teaching time hours, topics covered etc.

A further option is to act on feedback from students and thereby continually improve services to learners. One of the areas the OFT will be addressing is whether institutions have appropriate complaints procedures if things go wrong. Reasonable complaints received from students should be carefully considered and acted upon in order to ensure that learners are receiving value for money.

The more accurate and available the information on offer is, the better protected institutions will be against the risk of having to provide refunds, discounts, pay damages or risk damage to reputation resulting from a claim.

Matt Kelly (pictured) is a partner and Michael Goitein is a solicitor at Thomas Eggar, the law firm