ALBANY — A new law in New York will take the pain out of canceling gym memberships and cutting ties with businesses that rely on automatic renewals to keep customers hooked.
Gov. Cuomo signed legislation Wednesday allowing gym members to cancel subscriptions and end recurring charges while cracking down on businesses that mislead consumers through automatic renewals based on free trial periods or continuous-service schemes.
“Exercising during this pandemic is hard enough – New Yorkers shouldn’t have to jump through hoops or visit a gym in person simply to quit their membership,” said sponsor Sen. Brad Hoylman (D-Manhattan). “Too many gyms, subscription boxes and other companies use misleading offers and promotions to lock unwitting customers into long-term contracts that are ridiculously difficult to get out of.”
Many consumers also find themselves trapped by deceptive contracts after being lured in by free trials or promotional prices, studies show.
A recent Bankrate.com analysis of credit or debit cardholders found 59% of people who signed up for a free trial were later charged against their will. The Better Business Bureau found this sort of automatic renewal scheme has cost consumers $1.3 billion over the last 10 years.
The legislation, first proposed in 2013 and sponsored by Assemblyman Jeffrey Dinowitz (D-Bronx), requires businesses making an offer to New York consumers involving an automatic renewal or continuous service to clearly present the terms of the offer and get a consumer’s affirmative consent before charging them.
It also mandates that businesses provide a convenient method of canceling services — through a toll-free number, email address, postal address or another easy, cost-effective mechanism.
“This has been an issue for years, but during the pandemic, it poses a unique and severe risk to immunocompromised and elderly New Yorkers who should not have to risk their health to cancel memberships they no longer can use,” Hoylman said.
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