Anytime Fitness’ ‘any gym’ claim found to be misleading

Anytime Fitness is misleading customers by claiming they can visit any of the chain’s more than 600 gyms in Australia without making clear that could come at the cost of increased fees, a tribunal has found.

In a decision that challenges the chain’s business model, the New South Wales Civil and Administrative Tribunal found that Anytime’s protocol of transferring memberships to the branch a customer uses the most, even if they have simply moved house, breached Australia’s consumer laws.

Under Anytime’s rules, if the new gym has a higher price than the customer’s old one, their fees automatically rise, forcing patrons to either accept the new membership fee or face what can be a hefty cancellation charge.

The matter was brought by a Sydney man, Reginald Yakob, who had signed up at Anytime Fitness Campbelltown on the city’s southwestern fringe and been a member there for 10 years.

After moving away to Parramatta, in the heart of the city’s west, he began going to a branch in the area, thinking he was entitled to do so because Anytime boasts that its members can access any of its facilities.

In line with its franchise model, different Anytime Fitness branches can determine membership fees, sign-up promotions and key costs. Inner-city locations tend to charge more because of higher rent and labour costs.

This meant that Yakob, who had signed a contract committing him to $19.95 in weekly membership fees in Campbelltown, was now being forced to pay $25.95 per week by the Parramatta South branch, representing a roughly 30 per cent increase.

He did not want to pay the higher weekly fee, but cancelling his membership was not a reasonable option either, as it would have incurred a penalty of about $400.

Yakob then took the matter to the tribunal, alleging that his Anytime Fitness branch had engaged in misleading conduct and that it had applied an unfair contract term under consumer law. He also alleged that it breached its own contract terms, as it did not give him the required 35 day notice for an increase in membership fees.

Ahead of the final hearing, the Anytime Fitness franchise in question defended the so-called transfer clause in its contracts, claiming it existed “to prevent individuals from signing up in lower cost areas and then starting to use gyms in higher-cost areas”. The business did not attend the final hearing or submit further evidence.

Tribunal member Michael Terceiro made several findings against Anytime Fitness, including that it breached its contract terms by only giving Yakob 31 days notice of the fee increases.

The more significant finding, however, was regarding the transfer clause Anytime includes in its contracts as standard.