Next Steps on the Loyalty Points Story

During the last six months of 2016, there was much discussion about the plan by Air Miles to let miles five years or older expire starting January 1, 2017. However, in December, the Ontario Legislature passed Bill 47, Protecting Rewards Points Act, prohibiting the expiry dates on reward points programs based on time alone in Ontario. This led many to conclude this story is over. However, for consumers, and especially those Canadians with loyalty point balances, what happens next may be just as important as the passage of the bill.

                                         

So What Happens Next?

The Government of Ontario plans to consult with the public and businesses to develop regulations aimed at protecting consumers’ points while maintaining the viability of rewards programs. No details have been announced regarding the timing or the format of this consultation process.

Photo courtesy of Steve Buissinne

 

Why is This Important? Three Words: The Fine Print

Just like the terms and conditions of your loyalty program membership agreement, the fine print of Bill 47 had unexpected surprises for Ontario consumers. The bill amends the Ontario Consumer Protection Act to allow the Lieutenant Governor in Council (i.e. Cabinet) to make regulations “governing the transfer of rewards points among consumers, including upon death.”

What does this mean? Currently, policies regarding the transfer of loyalty points are determined by loyalty program providers. Some loyalty programs, such as the Shoppers Optimum Program, allow the transfer of points between members free of charge. Others, such as Aeroplan and WestJet Rewards, charge a fee to transfer, while several programs prohibit the transfer of points altogether.

Loyalty program providers appear to hold all the cards when it comes to terms and conditions of their programs (Photo courtesy of Piotr Lohunko)

A similar potpourri of policies apply upon the death of a loyalty program member. Some loyalty programs allow the transfer of points to a loved one while others simply close the account. The bottom line is these policies are largely dictated to consumers by loyalty program providers. However, the impending consultation and the creation of regulations by the Government of Ontario may change that. This could benefit Ontario consumers in particular and by extension consumers across Canada.

 

PIAC’s Position?

In 2013, in a report entitled, “Customer Loyalty Programs: Are Rules Needed?”, PIAC discovered there were a number of consumer irritants associated with loyalty programs. PIAC concluded that industry-wide guidelines were required relating to loyalty currency transfers and bequeathal. Moreover, PIAC called for the creation of a complaints body for consumers on issues that arise relating to the operation of loyalty programs.

As a result of the Bill 47, the Ontario Ministry of Government and Consumer Services may have just become the loyalty program complaints body that PIAC requested. In addition, any future regulations regarding the transfer and bequeathal of loyalty points may answer PIAC’s call for industry-wide guidelines.

 

What’s the Catch?

The catch is that the Government of Ontario is not legally compelled to do anything. The relevant clause of the Ontario Consumer Protection Act amended by Bill 47 states the Lieutenant Governor in Council (i.e. Cabinet) may make regulations regarding the transfer and bequeathal of loyalty points. While it certainly appears the Ministry of Government and Consumers Services intends to create regulations, the Ministry could theoretically walk away from this exercise at any time.

 

Photo courtesy of Negative Space

 

What Can Consumers Do?

PIAC believes all loyalty programs should operate under the same rules regarding the transfer and bequeathal of loyalty points. Whether or not you agree with this statement, the Government of Ontario is providing a ground-breaking opportunity for consumers to comment on loyalty program policies with the potential to make them better for consumers. As a result, consumers can bring any loyalty program issue they feel is important before the Ministry of Government and Consumers Affairs or your Member of Provincial Parliament (M.P.P.) for their consideration.

PIAC encourages Ontarians and all Canadians to send a message to the Government of Ontario expressing the need for new regulations on loyalty currency transfers and bequeathal. In addition, PIAC believes the Government of Ontario should further examine those loyalty program issues identified by consumers during this consultation process.

Make sure the Government of Ontario follows through on its plan to consult and to develop regulations aimed at protecting consumers’ loyalty points.

 

Jonathan Bishop has been a Research Analyst with the Public Interest Advocacy Centre (PIAC) since 2012. He is the author of PIAC’s 2013 study of customer loyalty programs in Canada entitled, “Customer Loyalty Programs: Are Rules Needed? The report noted consumers have little recourse when loyalty program providers unilaterally decide to devalue their loyalty currency, or change other terms and conditions of loyalty programs. PIAC advocated for industry-wide guidelines relating to loyalty currency devaluation, transfers and bequeathal. Moreover, the report called for the creation of a complaints body for consumers on issues that arise relating to the operation of loyalty programs, as well as guidelines for the notice given to changes in loyalty program terms and conditions.

Popping the Hood: Car Stress Suggestions

Note: This post is for information purposed only and does not constitute legal advice. If you require legal advice, please contact a lawyer. You may wish to consult legal reference resources such as the Law Society of Upper Canada’s Lawyer Referral Service, Community Legal Education Ontario (CLEO), or the Canadian Bar Association’s list of Pro Bono Legal Resources in Canada.

Here at PIAC, we often receive emails and letters about consumer advocacy on a variety of subjects, some outside the scope of our expertise. Over the past few months, Canadian consumers have written us repeatedly regarding various struggles they have encountered regarding automobile ownership. According to Statistics Canada, over 11 million Canadians depend on their vehicle to get to and from work. As a result, we’re pleased to offer a few resources for those experiencing car troubles.


Photo Courtesy of Ryan McGuire

Step 1: Talk to your dealer. In most cases, consumers have already taken this step. However, it is worth inquiring since the source of your problem may have already been identified by your vehicle manufacturer or dealer. In addition, your issue may already be the subject of a recall or other remedy. You can search for vehicle recalls using Transport Canada’s Motor Vehicle Safety Recalls Database or consult Transport Canada’s Motor Vehicle Safety Directorate for other safety issues.

Step 2: If your concern remains unresolved after discussing it with your dealer, you may approach the organization that regulates the sale of motor vehicles in your province or territory. Usually, this is a vehicle industry council, such as the Alberta Motor Vehicle Industry Council (AMVIC), the Motor Vehicle Sales Authority of British Columbia or the Ontario Motor Vehicle Industry Council (OMVIC). In many instances, these organizations will investigate your concerns and offer a dispute resolution service.

Step 3: If the complaint remains in dispute after consulting the regulator, you may consider contacting the Canadian Motor Vehicle Arbitration Plan (CAMVAP). CAMVAP is a program for disputes between consumers and vehicle manufacturers. Alleged manufacturing defects or implementation of the manufacturers’ new vehicle warranty can be put before a neutral third party (arbitrator) for resolution. To reach CAMVAP, visit their website or call 1-800-207-0685.

Photo Courtesy of Evan Kirby

Consult An Experienced Honest Broker: At any point during this process, you may also consult an organization with expertise in the automotive sector from the consumer perspective, such as the Automobile Protection Association (APA). The APA disseminates information about automobile defects, advocates for improved automobile safety standards and promotes consumer information about the automotive industry in Canada. The APA routinely appears as a media commentator, and collaborates frequently with news programs such as CTV’s W5 to raise awareness on automotive issues. More information can be found on the APA website, or by calling 416-204-1444


Photo Courtesy of Burak Kebapci

PIAC hopes the vast majority of Canadian automobile owners never require this information. However, if you do experience car troubles, the resources listed here may help fix your problem and get you back on the road.

Jonathan Bishop has been a Research Analyst with the Public Interest Advocacy Centre (PIAC) since 2012. He has authored or co-authored numerous research studies from the consumer perspective on a range of issues including international wireless data roaming, customer loyalty programs and air passenger rights. He can be reached at jbishop@piac.ca.