Nursery Extortion

Barnezy

We live in SW London where there is an acute lack of childcare options and as such some nurseries are taking advantage of this. Our son has been attending his nursery since 2017 in in that time there have been two annual fee increases of 4% each time. I looked in to it and the nursery has increased its fees by 18% over the past 5 year period. It quotes improvements and salary increases as the cause, but I’m yet to see what these improvements are and I doubt they are giving their staff a c6-8% salary increase each year. This just feels like a blatant exploitation of the position the nursery has, especially when your child is already attending.

This aside, my question is whether the terms in the nursery’s contract are valid as they seem disproportionately balanced in the favour of the nursery. The notification of the fee increase came on 1st November as per their T&C’s, however this is a full month after the last day you can give notice to remove your child from the nursery, without being subjected to the increased fees. According to their terms the earliest you could leave is the 30th April meaning you are liable for whatever they choose the fees to be, for at least 3 full months. This cannot be right.

Secondly the notification period seems extremely exaggerated. Why at a nursery that has an extensive waiting list do they only allow children to leave at 3 points in the year without incurring a fee. And on top of this a minimum of 3 months’ notice needs to be given as well. This also seems to be very heavily stacked in the nursery’s favour and unfair to their consumers.

As a result of the consecutive increases and it’s unpredictability, we are looking to take our child out, in favour for another nursery we have found. When and how we do this will be down to whether the terms in this contract are challengeable given the current context. I’m happy to employ a lawyer to conduct proceedings, but before I do that I wanted to get a view from others, what they believe the approach should be.

I've tried to attach a photo of the terms but the site won't allow me as I'm new. If I can PM someone the link to the photo, can they post it for me?

dj1471

With inflation around 3% it's not such a big increase.

If they're increasing their fees while you're in contract then you can cancel without penalty. The usual cancellation rules wouldn't apply, since they've made a change to the contract which is detrimental to you. Such a change can only be made with the agreement of both parties, same principle as your phone or broadband supplier increasing your monthly rental. Have you queried this with them?

Aylesbury_Duck

How much are they charging per hour?

Barnezy

They have increased fees by 18% over the past 5 years. RPI the inflationary rate they’ve referenced has increased by 9.4% over the same period. It is a large increase when your monthly fee is due to be £3,300pm when our second child starts.

Thank you for the advice. Yes I have asked them if they would waiver there normal termination terms in the light of the increase and have received no response. I spoke to the office manager today and I asked her if they have been challenged on this term due to it being unfair and her response was “no, everyone has agreed to our terms and that’s what they are.”. There was no point continuing that conversation.

If we go in to January and pay the new fee, are we then agreeing to it and there bound by the cancellation clause again. We pay by DirectDebit BTW.

unholyangel

Barnezy wrote: »

They have increased fees by 18% over the past 5 years. RPI the inflationary rate they’ve referenced has increased by 9.4% over the same period. It is a large increase when your monthly fee is due to be £3,300pm when our second child starts.

Thank you for the advice. Yes I have asked them if they would waiver there normal termination terms in the light of the increase and have received no response. I spoke to the office manager today and I asked her if they have been challenged on this term due to it being unfair and her response was “no, everyone has agreed to our terms and that’s what they are.”. There was no point continuing that conversation.

If we go in to January and pay the new fee, are we then agreeing to it and there bound by the cancellation clause again. We pay by DirectDebit BTW.

I wouldn't have "asked" them to waive the normal termination clause, I would have simply told them they cant vary the terms of an agreement after it has been agreed - especially price as that is often the most important factor to a consumer - and that they can either provide the services at the agreed price or allow you to cancel without penalty (which means without being worse off).

TBH nurseries are as bad as gyms when it comes to contract fairness. They'll be in for a shock if they're ever taken to court over terms allowing them to charge while providing no service, allowing them to increase the price mid contract etc.

Barnezy

There is a term in the contract stating fees are reviewed annually and communicated on the 1st November. Does this validate their increase? Surely not.

If it’s valid for a £1 increase then it’s valid for a £1000 increase if they feel like it, which seems rediculous.

bris

Well the review date is always going to be an issue so the 1st November is as good as any other date.


As already mentioned like a phone contract if you don't agree with the increase then you can leave without penalty.


They aren't doing anything wrong, demand far outstrips supply so the ball is in their court.

Aylesbury_Duck

+1 to the above.

What they’re charging doesn’t seem out of step with what’s charged around here (East Kent). Seems a simple supply/demand ratio to me. Are they a business seeking a profit and if so, why do they not deserve to make a profit like any other business? That’s not to excuse any unlawful contract practice of course, more a comment on the definition of “extortion”. You will pay much much more per hour for someone to look after your car, without complaint.

antrobus

Barnezy wrote: »

They have increased fees by 18% over the past 5 years. RPI the inflationary rate they’ve referenced has increased by 9.4% over the same period....

The NMW was £6.31 in 2013 it's now £7.83. 24% increase.

Mind you, that's only a quick Google.

Plus pension auto enrolment on top.

warehouse

Your child is the most important thing you'll ever be responsible for in your whole life and your worrying about the cost of childcare?

Sorry OP but something's very wrong here.

Barnezy

antrobus wrote: »

The NMW was £6.31 in 2013 it's now £7.83. 24% increase.

Mind you, that's only a quick Google.

Plus pension auto enrolment on top.

I don’t believe their staff are on MW being in London, plus wages aren’t 100% of their costs. I take the point on pensions.

Yes they are a business and entitled to make a profit. The concern I have is the way they choose to communicate this at a time, that according to their terms, means you have to accept it for a minimum of 3 months. If they announced it a month earlier, you could choose to leave the nursery within the terms of the contract before the change came in to effect. Surely this is calculated on their side and is not the type of commercial practice I want to support.

If I’m reading the comments correctly, when the nursery announced the fee increase they voided the contract, regardless of whether they have a term in there stating fees are reviewed annually? If so we have the right to end our contract at anytime without penalty or loss.

My last question is, if we allow the contract to roll into Jan and start paying the new fee, is this seen as agreeing to the new terms and therefore solidifing the contract until they change the fee again?