Telco complaints from SMEs soar as Ombudsman steps up to protect small business

The Telecommunications Industry Ombudsman’s move to increase its scope to negotiate on behalf of small businesses has seen complaints climb by 52% on the last financial year.

The latest newsletter for the TIO reported that over 22,000 complaints were made to the Ombudsman by small businesses about their telecommunications services in the financial year ending in December 2011.

In the second half of 2011, over 12,000 complaints were made by small businesses to the Ombudsman, accounting for 13% of all new complaints to the TIO.

Ombudsman Simon Cohen told SmartCompany this morning that changes to the TIO’s jurisdiction on the size of dispute it could intervene in has opened up the TIO as a mediator for telco disputes for thousands of small businesses.

“We’ve increased our capacity to deal with their complaints. Our powers to make binding decisions were increased from $10,000 to $30,000 and our powers to make recommendations were increased from $50,000 to $85,000,” Cohen says.

“We’re now able to deal with an increased range of companies,” he says.

But Cohen also pointed to small businesses’ increasing reliance on a functioning internet connection and effective mobile telephone services as a reason for increased complaints.

“These services are critical for small businesses. If they don’t work properly it becomes an issue for their profitability and competitiveness,” Cohen said.

The TIO’s report said that inadequate or incorrect customer service advice, poor mobile phone coverage, broken promises and bill disputes are the most common issues small businesses have with their telecommunications providers.

The TIO handles complaints for small businesses on the basis that they are unlikely to have the resources to take on their service providers through the formal and often costly legal system.

As well as widening their monetary limits, the telco ombudsman is also overhauling the way they define a small business.

While a business must still have 20 employees or less and have turnover of less than $3 million, the TIO will also look at the nature of the business, the issue in dispute and the ownership structure or management of the business when assessing claims. 

This moves away from previously focusing on how much a business would regularly spend on telecommunications services, and the amount that was in dispute. 

 

 

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