Vodafone, EE, Three, and O2 Could Owe Customers Nearly £2,000 Each
The UK’s four largest mobile phone network operators, Vodafone, EE, Three, and O2, are currently embroiled in a class action claim exceeding £3.2 billion. The claim accuses these companies of using their market dominance to overcharge on an estimated 28.2 million UK mobile phone contracts.
Details of the Allegations
The class action, led by former Citizens Advice executive Justin Gutmann and supported by law firm Charles Lyndon, alleges that these operators charged existing customers higher “loyalty penalties” compared to new customers for identical services. This primarily involved overcharging for handset costs beyond the contractual term.
Potential Payouts for Customers
If the claim is successful, affected customers could receive up to £1,823 each. The allegation centres on the operators’ failure to reduce overall charges after the minimum term of contracts expired, even though customers had fully paid for their handsets. This led to higher charges for existing customers compared to new ones who were only paying for airtime services.
Legal Proceedings
This significant legal challenge has been filed with the Competition Appeal Tribunal in London. All qualifying customers are automatically included in the claim for free, with an option to opt-out.
Statements from the Operators
- O2: Claimed no prior contact with their legal team regarding this issue, highlighting their long-standing practice of split contracts that reduce customers’ bills once handsets are paid off.
- EE: Strongly disagreed with the claim, emphasizing their range of tariffs and processes for end-of-contract notifications.
- Vodafone: Noted that the claim is new to them and that their legal team is yet to assess it in detail.
Comment from Justin Gutmann
Gutmann expressed his motivation for launching the class action, citing a systematic exploitation of millions of loyal customers, especially during challenging economic periods like the financial crisis of 2008, COVID-19, and the ongoing cost-of-living crisis.
Implications and Next Steps
This case puts a spotlight on the practices of major mobile operators and could have significant financial implications if the claim is successful. The operators’ responses suggest differing perspectives on contract policies and customer charges.
