Automatic compensation: What you need to know

01 April 2019

From 1 April 2019, the Automatic Compensation Scheme means broadband and landline customers will get money back from their provider when things go wrong, without having to ask for it.

Update 5 June 2020 – the coronavirus

Keeping communications going across the UK has never been so important. Broadband and landline services have played a vital role as we have all been adapting the way we live and communicate due to the coronavirus.

In March 2020, given the unique circumstances presented by the coronavirus, Ofcom explained its view that it would be legitimate for providers not to pay automatic compensation just as if the civil emergencies exception in the Automatic Compensation Scheme applies.

Ensuring broadband and landline customers get compensation when things go wrong is an important part of our work to make sure providers treat customers fairly. So we have been keeping the situation under close review to ensure signatories return to paying automatic compensation as soon as possible.

Changes at the network level and in engineer availability mean that most signatories have now restarted automatic compensation payments for at least some service issues. If you are experiencing problems with your service you can contact your provider or find information on their website.

The coronavirus continues to present challenges and there are unique circumstances in which we consider it remains legitimate for providers not to pay automatic compensation. For example, some problems may require an engineer’s visit to a customer’s home, which may not be possible if they are self-isolating. Where signatories do claim an exception to paying automatic compensation applies, we expect them to clearly communicate the reasons why to their customers, and continue to act in their customers' best interests.

Is your provider signed up to the scheme?

The following firms are signed up to the scheme:

  • BT (joined 1 April 2019)
  • Hyperoptic (joined 28 October 2019)
  • Sky (including NOW Broadband) (joined 1 April 2019)
  • TalkTalk (joined 1 April 2019)
  • Utility Warehouse (joined 17 February 2020)
  • Virgin Media (joined 1 April 2019)
  • Zen Internet (joined 1 April 2019)

When you will receive compensation

Firms that signed up to the scheme will provide compensation for delayed repairs following a loss of service, missed repairs or provision appointments, and delays to the start of a new service.

Table illustrating the problems that would entitle a landline or broadband customer to compensation, and the amount of compensation they should receive.

If your landline and broadband both lose service at the same time, you will only receive one compensation payment.

What you need to do to receive compensation

If your service doesn’t start on the agreed date, or if your engineer appointment is missed, your provider will pay compensation automatically – meaning you don’t need to take any action to receive the compensation.

If your broadband or landline service stops working, you will simply have to report the fault to your provider. If the service is not fixed after two full working days , you would not need to ask for compensation or contact your provider again, as your provider has systems in place that mean you will start receiving compensation automatically if the repair takes too long.

You will receive an initial £8 if the service is not fixed two full working days after you report it, and then £8 for each full day it is still not fixed after that.

The scheme applies to new orders placed or problems reported from 1 April 2019.

What services are eligible for compensation payments

The scheme covers all residential fixed broadband and landline products.

When you should receive compensation

Compensation should be paid no later than:

  • 30 calendar days after a delayed start of a new service is resolved or the service is cancelled;
  • 30 calendar days after the loss of service is resolved or the service is terminated;
  • 30 calendar days after the date of the missed appointment.

How compensation will be paid

Unless you agree otherwise, compensation will be a credit on your bill. The credit will appear on your account within the timeframes above but may show on your bill at a later date.

Your provider can offer you alternative forms of compensation of the same or higher value, as long they make you aware of how much you could receive in the form of a credit on your bill.

When might a provider not pay automatic compensation under the scheme?

If the loss in service is caused by equipment or activity within your home, you are not entitled to compensation under the scheme.

Similarly, you won’t receive compensation if you breach your contract, if you caused the service failure or if you prevent it from being resolved – for example if you ask for a later engineer appointment than the one offered and delay repairs to the service.

Providers can put a cap on the amount of compensation they pay out. After 30 days of an automatic compensation payment occurring, they can serve a cease notice to let you know that automatic compensation payments would stop after a further 30 days.

After this, your provider needs to take reasonable steps to provide a suitable alternative service. If they are not able to give you a suitable alternative, you will still be entitled to automatic compensation under the scheme.

What if you don't receive the compensation you believe you should?

If you don’t receive compensation you believe you’re entitled to under the scheme, raise it with your provider. Unresolved complaints can go through an Ofcom-approved alternative dispute resolution (ADR) service.