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It’s surprisingly easy to be taken in. They take full page colour adverts in the local phone directories and sound so trustworthy with their claims of decades in the business built on honesty, reliability and quality service.
They use 1300 numbers but say they serve the local area. And they could be tilers, concreters, electricians, roofers, chippies or even plumbers; in fact virtually any trade.
In one instance a local man thought he was getting his sewer unblocked for less than $1,000. He was presented with an account for over $8,000, after only two days’ work on the job, and told immediate payment was required.
When the householder had the temerity to question the amount he was threatened with a 2% per day (700%) interest rate bill unless he agreed to sign off on the job immediately.
Fortunately he had the good sense to refuse to sign. It’s in the hands of lawyers now, the Office of Fair Trading have been contacted and it should end up in the tribunal shortly.
But how can this happen? Well, it’s not new and, according to the legal people, who apparently see this sort of activity on a regular basis, they even have a name for the practice, they call it ‘bait and switch’.
Here’s how it works. The customer starts off thinking they are getting a really good deal.
In the case above a minimal call-out fee for an emergency job on a weekend was the ‘bait’.
Next, and this is important, they get the customer to sign a ‘do and charge’ agreement not a fixed price quote. They will give all sorts of reasons to convince the customer why they can’t give a fixed price and often strongly suggest they will save money by doing the work on a charge up basis.
But as soon as the tradies arrive on site they are actively looking for extra work. That’s the ‘switch’.
In fact, they ‘found’ another blockage the man didn’t even know he had. And when he was at work they convinced his wife their electronic locator had found a blockage 13 feet deep (even though it was not visible on their own CCTV).
The scheduled half-day on site (for one tradie) on the following Monday morning quickly turned into a major two-day job for two for tradies and an excavator.
And here’s the real sting. They didn’t tell the unsuspecting owner that the ‘emergency’ rates (over $100 per hour) were being charged up for every hour and for every person on the job whether they were needed or not … during normal working hours. What’s more, they added extras at any price they chose to the ‘blank cheque’.
They all seemed so friendly and helpful when they first came on the site; the man only became suspicious when he was finally shown an itemised account.
Before the standoff he was prepared to settle for $4-5000, but he quickly saw the driver of the mini-excavator was being charged 10.5 hours in a single day at nearly $108.00 per hour - that’s $1,134.00 for labour only. The machine was being charged extra on top of that (and even that was 20-25% over the going daily rate) - and GST was also added on top.
The alarm bells finally started to ring for our trusting householder who now has real doubts whether the second blockage ever existed.
How this householder fares when his case finally makes it to court only time will tell, however it is clear that this type overcharging scam is widespread and likely to continue if not exposed.
WARNING: Householders should be vigilant when employing tradesmen who are not known to them personally or recommended by friends or neighbours.
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Not only trades’ people are acting in this manner. Energy providers are competing and trying to lure consumers into a contract for better rates. I received an offer in July with really attractive rates from one of them, which were much lower compared to my existing supplier. Naturally, I accepted the offer from the new provider. While away overseas a letter arrived in the mail with the information that the rates quoted were wrong and rates much the same as I have been charged by my previous supplier were to apply. I had to respond by a certain date, which I could not, because I only read the letter with the imposed deadline for response, much later upon my return to Australia. Only today I received an email, which did not even show who it was from, only stated Web Call Center as sender, stating that I entered into a contract with my new energy supplier. I only opened this mail by chance because it looked like spam, but responded accordingly. The ploy behind this is, that if the ‘contract’ is breached it would incur a penalty. If this supplier will insist that I have entered a contract with them I will refer this matter to the Department of Fair Trading. Just be aware of these practices of some energy providers.
by Petra Schwarz
08 Dec 09 15:56