An Australian telco audit has cast ‘serious doubts’ over whether staff are sufficiently trained to assist vulnerable customers

  • Australia’s telecommunications watchdog has issued a new list of industry guidelines, designed to protect vulnerable customers when seeking new phone and internet plans.
  • The guidelines come after an audit of nine Australian telcos, which raised “serious doubts” that staff training is up-to-date across the industry.
  • “A generic approach seeking to ensure equivalent service to all consumers fails to grasp the specific needs of vulnerable consumers,” the audit found.
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Australia’s telecommunications watchdog has launched a new draft list of expectations for the nation’s phone and internet service providers, after an audit of nine leading telcos raised “serious doubts” that sales staff are equipped to responsibly offer products to vulnerable consumers.

The Australian Communications and Media Authority (ACMA) on Wednesday outlined five priority areas for the sector, designed to ensure sales staff comply with responsible selling guidelines under the Telecommunications Consumer Protections Code (TCP).

Such measures are essential to ensure payment plans do not “result in unnecessary financial distress and/or potential disconnection of services that are essential to participation in modern life,” ACMA said.

The draft guidelines call on the industry to proactively identify vulnerable customers, remove incentives for up-selling to vulnerable consumers, support customers experiencing financial hardship, use disconnection as a last resort, and install a culture of responsibility from the C-suite down.

That list of expectations was formed after a twelve-month audit of Australian telco players Telstra, Optus, TPG Telecom, TPG Internet, iiNet, Southern Phone, Tangerine, Escapenet, and Veetel.

The audit found five of the nine telcos adopted the Australian Competition and Consumer Commission’s guide to identifying a potentially vulnerable customer, which considers if customers have a low income, are very young or old, homeless, geographically isolated, have a physical or learning disability, or come from an Indigenous background.

Some telcos also addressed factors including whether the customer is a victim of domestic violence, impacted by a natural disaster, or financially harmed by the COVID-19 pandemic. But other providers used a “narrower approach” to identifying potential vulnerability, ACMA said.

“A generic approach seeking to ensure equivalent service to all consumers fails to grasp the specific needs of vulnerable consumers,” the audit found.

Training measures also came under the microscope, with ACMA finding that three telcos could not confirm their sales staff had received TCP refresher training in the past twelve months.

“This casts serious doubts about whether sales representatives and other staff can be regarded as appropriately trained in TCP Code requirements,” ACMA said, adding that the government body “will not hesitate to investigate and take action against telcos who fail to comply with their training obligations under the TCP code.”

The review also found “some training would be improved if it provided more practical guidance to sales representatives in identifying vulnerable consumers and their needs.”

No telco involved in the audit highlighted new systemic issues linked to responsible selling, prompting further scrutiny from ACMA.

“Telco monitoring programs may not be thorough enough,” the watchdog said.

“We will be seeking further information from the major telcos on their monitoring programs to seek assurance that their programs are sufficiently targeted and capable of effectively identifying systemic issues that may arise when selling products to vulnerable consumers.”

The audit and list of industry expectations arrive two months after the Federal Court handed Telstra a record $50 million fine for the “systematic” sale of post-paid mobile products to 108 Indigenous Australians, who the telco knew did not understand the products they had been sold and could not afford to pay for them.

“The release of this audit and our statement of expectations aims to set out better policies and practices for telcos to identify and assist consumers deal with complicated technology and complex pricing models,” ACMA Chair Nerida O’Loughlin said.

“We look forward to engagement from the sector on these matters.”

Public consultation on the list of industry expectations is open, with submissions due by Wednesday, September 8.