Consumer protection and students – Where are we now?

Unsurprisingly, given the widespread disruption caused by the coronavirus crisis, there is currently a great deal of attention on students’ rights as consumers, with numerous public statements on the point from ministers and regulators. How best should institutions mitigate the risk of claims or complaints in this area?

The law

For students who accepted the offer of a place after 1st October 2015, the information produced by or on behalf of a provider on which they relied to accept the offer of a place became part of their contract with the provider. That information cannot be changed without their express agreement and failure to deliver in accordance with it constitutes a breach of contract giving rise to claims and remedies. The information students received will include the provider’s terms and conditions as long as these were drawn to their attention at the time they accepted their offer of a place.

Variation clauses and force majeure clauses contained in such terms and conditions will only be enforceable to the extent that they are fair. A term is unfair if it creates a significant imbalance in the parties’ rights and obligations under the contract. A unilateral right to make changes, especially where these could fundamentally alter the nature of a course, service or facility could well be considered unfair, even where students are notified or collectively “consulted” on changes, especially if their remedies are restricted, for example, to withdrawing and refund of fees only. Such clauses will also be narrowly construed and any ambiguity in the drafting interpreted in the way that is most favourable to students.

Even if a clause is theoretically fair, the changes proposed must themselves be reasonable in the particular circumstances. Changes that might be reasonable for one course (e.g. to move all content on line) may not be reasonable for another, say where significant practical content was anticipated. For such courses, some other alternative might need to be offered, for example, completion of practical content at a later date, or over a longer period of time in smaller, socially distanced groups. If a change is proposed on the basis of the pandemic as a force majeure event, then it must only go as far as is needed to address the direct consequences of that event, and not, for example, to implement desired longer term changes.

If an institution makes changes that are not covered by an effective variation provision in the relevant terms and conditions in place with each student, then students will have the following principal remedies

  1. The right to a repeat performance of courses or services that were not delivered in accordance with the published information, if practically possible;
  2. The right to a discount on the fees paid, up to 100% depending on how far short of what was promised deliver falls;
  3. Damages for other reasonably foreseeable losses.

Ministerial and regulatory interventions

According to its guidance, the OfS will take into account “as a matter of course” the effects of the pandemic on a provider’s ability to meet its conditions of registration, but any changes proposed to courses must nonetheless ensure that an institution continues to comply with its conditions of registration, particularly those relating to quality and standards, management and governance, consumer protection and student protection. The OfS has indicated it does not expect to take regulatory action where providers have done what they reasonably can to protect students’ interests and to guarantee academic standards. It appears that in deciding whether or not providers have met these criteria, the OfS will take into concerns notified by students or other third parties including the OIA. Implementing changes in a way and to a degree that means students are less inclined to complain and challenge will thus also reduce the risk of regulatory action and to events reported to it by providers. Although the OfS has relaxed its general approach to reportable events, it continues to require providers to report where they cease or suspend “delivery of any higher education courses to current students where reasonably equivalent alternative study options are not provided”. Therefore, decisions to cancel courses carry a potentially higher risk of regulatory interventions than making changes to courses.

The Competition and Markets Authority has not issued any updated guidance for higher education in response to the coronavirus crisis, but published a statement that applies to all businesses in all sectors. This suggests that they expect refunds or partial refunds to be provided in cases of non-delivery or partial delivery of services, but is less clear on altered delivery of services. Therefore, the legal principles above are likely to continue to apply where providers vary courses.

The Minister has indicated that she does not expect any refunds to be paid to students if they receive an adequate alternative delivery of the course, e.g. online.

The Office of the Independent Adjudicator for Higher Education

The OIA has also issued a briefing note on its approach to pandemic related complaints. It has indicated that even where a provider can establish a contractual right to vary or avoid delivery of courses, services or facilities, it will nonetheless expect institutions to take reasonable steps to ensure the impact on students is kept to the minimum possible. Thus, even if a provider is able to demonstrate that it is not in breach of contract/consumer law, it may nonetheless be ordered to pay compensation by the OIA if it has not done all it can to minimise the impact on students of the changes it decides to make.

Practical risk management

To mitigate the risks in this area, providers should:

  • Wherever possible offer alternative methods of delivery rather than withdrawing courses, services or facilities, even if these have to be at a different time.
  • Ensure changes continue to meet any PSRB requirements. If this is not possible, take specific advice, as these students may have larger demonstrable losses.
  • If module options are to be changed, review the information provided to students to see whether this involves changes to material course information or not. If modules were advertised as “typical options may include” or similar, there may be more flexibility than those that stated “you will be able to choose from”.
  • Ensure the changes go no further than is needed to address the disruption caused by the pandemic. Changes needed to address wider issues such as viability or pedagogical improvement should be dealt with separately.
  • Be as flexible as possible around timing – delivering something later in the academic year or course is preferable to withdrawing it all together. This may be particularly appropriate for practical courses.
  • Ensure that the needs of different categories of students (e.g. disabled, part-time, international) are taken demonstrably taken into account.
  • Ensure that student feedback is sought and acted upon wherever possible. If it cannot be acted upon, record why.
  • Ensure clear communication with students and contact routes for students who wish to discuss their personal circumstances.

For more information visit our dedicated Covid-19 business or education pages.

  • On 5th May 2020