NJ Bill Makes Canceling Gym Memberships Easy but Concerns Loom
IHRSA, the top trade association for the health and fitness industry, has worked with the New Jersey legislature to reword the bill
A new bill in New Jersey that would require an online cancellation option for fitness consumers looking to cut ties with their gym memberships is headed to the desk of Governor Phil Murphy for final approval.
While the consumer-friendly bill may be a welcome respite from those who have had a difficult time canceling a gym or health club membership, IHRSA, a not-for-profit trade association representing the global health and fitness industry, has outlined key concerns regarding the ‘click-to-cancel‘ bill in NJ.
First introduced in 2022, Bill A3892 would require health clubs to provide an easy and prominently displayed pathway for consumers to cancel the automatic renewal of services that were entered into online and provides additional options for canceling health club services contracts by mail or over the phone in certain circumstances.
IHRSA, which submitted written testimony to the New Jersey Senate and urged officials to hold consideration of the bill, takes issue with what it describes as the significant “administrative burden” that online cancellation of auto-renew memberships and month-to-month accounts may cause for certain gyms and health clubs.
The trade association also points to the bill making changes to the ability to cancel during the three-day cooling-off period and notes that the bill’s passage would require changes to the membership agreement, cancellation option, website and other technical items before a possible “click-to-cancel” final rule from the Federal Trade Commission, which IHRSA says would also create an administrative headache for fitness operators.
Mike Goscinski, VP of government affairs for IHRSA, testified about the bill before the New Jersey Senate Commerce Committee last month.
“Passage of the bill would require some health and fitness facilities in New Jersey, mostly the smaller, independent and franchisee operators, to make costly administrative and technological changes prior to any forthcoming requirements from the federal government, that may be duplicative and contradictory,” Goscinski said in a statement.
IHRSA also outlined other industry concerns, such as the potential revenue loss of gyms and the operational costs to implement and maintain a secure online cancellation system. There are also possible legal matters that may arise should a fitness operator face challenges in adequately creating a system to comply, and smaller gyms may have additional challenges in implementing and maintaining a cancellation system that larger chains may not — which IHRSA says could create inequity in the fitness industry.
According to a recent post on IHRSA’s LinkedIn page, Goscinski has worked with the New Jersey legislature to reword the bill to clarify that it is “click to initiate termination” by notifying customer service through either a customer account on a club’s website or the user settings on a consumer’s smartphone or tablet — or a termination email formatted and provided by the club that can be emailed to the service provider without requiring additional information from the account holder.
The trade association issued a report in October demonstrating that in-person fitness has rebounded from the pandemic on a global scale, with members flocking to gyms and health clubs in remarkable numbers since COVID-19 requirements like masks and social distancing have subsided.
