Consumer Protection for Education and Training Providers

To celebrate the interest in my recently published book CRICOS CPR: Top 5 Tips to Rescue Your RTO, and for all those who ordered a copy and had to wait for the next delivery...I thought it would be a great time to share another extract of some information critical to all education and training providers across Australia, regardless of whether they are registered on CRICOS (Commonwealth Register of Institutions and Courses for Overseas Students) or not.

An extract from the book...

Why is it important?

We discussed briefly and broadly in the last chapter about the link between the Australian Consumer Law and your standard registration requirements. However, what we did not speak a lot about what why this is so important when dealing with an international education market and cohort of international students. If you’ve ever lived in or visited another country before, you will have an appreciation for the sometimes different context of a ‘buyer’s market’ or buying and selling. Whether the buying and selling be products or services, the protections around this process change from country to country. 

If you have had this experience previously in another country, you might recall how daunting it was trying to buy something without really understanding what your rights as a consumer were in that country. What if it’s not fit for purpose? What if I change my mind? What if…? How do I get a refund? How do I make a complaint? There are so many different questions and scenarios that might prevail and yet someone who is in a new country, experiencing and facing new laws and rights and responsibilities may not be aware of them. What’s more, if they are being asked to accept those terms and conditions of another country before they’ve even stepped foot in that country, it can be a very confronting exercise.

As is documented in the National Code 2018,

“International education can transform individuals, widening their intellectual horizons, opening them to new ideas and experiences, and extending their friendships. Their experiences, in turn, enrich Australian society and life.” 

However, if the marketing, recruitment and contractual arrangements supporting that education are not sound, explicit and protect the rights and responsibilities of all parties, things can go terribly wrong, jeopardising this experience. Crucially, prospective international students must have sufficient information to enable them to make informed decisions about studying their chosen course or courses with their chosen registered provider in Australia.

Some of the more common issues that international students have been exposed to in recent times which has led to the increased scrutiny of education providers in this space include:

• False and misleading conduct;
• Unfair contract terms; and
• Sales practices.

False and misleading conduct is clearly defined by the Australian Consumer Law (ACL) (ACL, sections 18-19) as:

“It is unlawful for a business to make statements in trade or commerce that:

• are misleading or deceptive; or
• are likely to mislead or deceive.

Failing to disclose relevant information, promises, opinions and predictions can also be

misleading or deceptive. 

In most cases, businesses cannot rely on small print and disclaimers as an excuse for misleading or deceptive conduct. A limited exemption applies to businesses (mostly media outlets) who make representations in certain circumstances in the course of carrying on a business of providing information.” (Emphasis is that of the author).

In order to determine if your conduct as an education provider is misleading or deceptive, the most important question that you can ask is ‘does the impression created by this conduct create a perception or a potential perception by the customer or client that is false or inaccurate’. According to the ACCC, if conduct provides a false or inaccurate perception about price, value or quality of products and services, then it is likely that a breach of the ACL has occurred. Another important fact is that silence can also be misleading if a business fails to disclose relevant facts to a customer. The ACCC is also very clear that n most cases, a business cannot rely on disclaimers, disclosures or clarifications buried in small print as an excuse for engaging in misleading or deceptive conduct. We will see another, unexpected example of potentially ‘misleading and deceptive conduct’ based on this description provided by the ACCC in Chapter 5 in relation to the Genuine Temporary Entrant criteria.

Some of the more common breaches of this part of the ACL by education providers in our experience include for example:

• The standard or quality of the course, facilities and student diversity of a registered provider;
• Testimonials by ‘students’ who have never studied with the provider;
• Partnerships, pathways or articulation arrangements with providers that do not exist in a written agreement;
• Offering gifts, prizes and free items either as incentives for enrolment (see our recent scandals in the VET sector with VET FEE-HELP as an example) or to offer such gifts, prizes and free items without the intention of providing them.

There are a huge range of resources available to providers to assist them to comply with Australia’s consumer protection laws but the purpose of this section of the book was to introduce you to why it’s important but also some of the more common areas of ACL that are problematic for education providers. To help providers ensure that they are meeting the requirements of the ACL, the Standards for RTOs 2015 and the National Code 2018 are both aligned to the ACL and have been designed in such a way to protect international stakeholders as they engage as a consumer in an Australian context. So let’s take a look at what the components of these standards would include to ensure alignment with ACL compliance.

What is included?

For an international student or a prospective or intending international student to be able to engage in a legal contract (offer to undertake a course or courses), there needs to be sufficient information for them to be able to make an informed decision. Now, let’s not forget that this intending student may be on the other side of the world and English might not be their first language. They might also be under the age of 18 years and collecting information on behalf of their parent or guardian who does not speak any English at all. Do they have enough information about what it is that you offer as a provider and what your courses include, for them to be able to make an informed decision about whether your course or courses or your college or university is right for them? Some of the more common information that must be included in accordance with both sets of standards relates to fees, charges and refunds, complaints and appeals handling, what happens if you choose to no longer run the course or your business collapses. Some of the more intricate information that must be included however relates to:

• The correct course name and course code;
• The purpose of the course;
• The course outcomes;
• The course duration;
• It’s relationship with other course(s);
• Details of any articulation arrangements;
• An accurate description of the profile of the student group (for example, are all the students from one country or mixed?);
• What are the course entry requirements, including English language proficiency?;
• What are the modes and methods of course delivery? Is there work-based training?
• What does the course structure look like? The timetable? Is it 20 hours course contact per week, are there any other study requirements and any scheduled breaks
• Are there any resources that I need to buy before the course commences?
• What are all the fees and charges I need to pay? Will these change while I’m enrolled?

One of the most simple and common issues that international students or intending international students face is that they have no concept of the Australian geographical context. For many students, they don’t understand that the campus that they’re applying for might be a 3 hour drive from the nearest major city or a 3 hour drive from the nearest airport. They might not realise when booking accommodation that the accommodation that they have booked is not close to public transport and they will not be able to get to and from their course. They often have no idea where to go or how to open a bank account, get a driver’s license, go to the doctor, find childcare if they have brought their young family.

International students often don’t know where to get support if they’re suffering from homesickness which is common, where to go if they are in trouble; for students from some countries they are afraid of approaching police and so if something happened to them and they needed police assistance, they might not access the support they need through fear. One of the biggest concerns of the Commonwealth government currently is that many international students who grace our shores have no prior history of swimming and statistically, have high rates of drowning. These are some of the areas that collectively, we should all endeavour to ensure that our international students have access to, enabling them to have all the information that they need to make their stay and their experience, a positive and memorable one.

Marketing and Contractual Materials

A short word on marketing and contractual materials as they apply to consumer protection practices because the next chapter is focused on marketing, it is critical that all of your documentation, marketing, promotion, pre-enrolment, written agreement and PRISMS registration of courses is all consistent. We frequently see clients with non-compliances because the information that the regulator has identified on PRISMS is different to what is on the website and different again to what is in the student’s offer letter and different again in the student’s written agreement. This is fast becoming an area of increased scrutiny by regulators because of the commonality of the non-compliance but it’s also important for 3 other reasons. 

The first of course is to ensure that you’re not in breach of the ACL, which is in summary what this chapter has been about. Secondly, it helps to avoid disputes between yourself and the student at any stage of the student’s journey and with a regulator whose audit model is focused on the student experience, the last thing you want or need is a complaint by a student prompting an unnecessary audit. The third issue, of course, is the effect of time. While a week or two after the inconsistent information was provided gives enough time for most people to remember the contractual terms at that particular time, it might be more difficult to provide evidence of what the agreement was based on 18 months later. Likewise, if there is some sort of promotion that applied to a student’s enrolment, it might be a safe practice to ensure a copy of that promotion is also kept on the student’s file for safe keeping in the event that there are questions at a time when you may not remember.

Are you safe?

In summary, we really need to look at the student centred audit model and what that might mean for your operation if there is ever a breach of the Australian Consumer Law or a complaint by a student.

In 2016, ASQA developed a student-centred audit approach that provides a greater focus on the student experience and the practices of providers. Under this model, the audit is structured around and focuses your practices and behaviours around marketing and recruitment, enrolment and support amongst other things. The depth and scope of the audit is determined by your compliance history and detailed risk intelligence (this could come from complaints, other government agencies, other audits, etc.) and they will interview your current and former students. 

If you were to take a quick survey of your students, what would they say about your marketing, recruitment and enrolment processes? What would they say about the support that they received? What would ex-employees say? Current employees? If you’re uncertain or you fear that the response might not be so positive, perhaps it’s time to review your operation to ensure that when your student centred audit approaches, you will be ready. There are many ways to undertake a quick assessment including having a suggestion box that you act on, reviewing your continuous improvement register, sending out a survey to students past and present, staff, industry and other stakeholders, undertaking an audit and/or getting an independent person to conduct the survey for you. There’s no time life now to get ahead and make sure that when the regulator comes knocking, you’re ready.

RTO Doctor conducts comprehensive risk management audits to assist providers to ensure their compliance with their regulatory requirements; a critical issue given that for RTOs around the nation, the Annual Declaration of Compliance is due very soon. For all those who purchase a copy of the book, there are special codes that provide a range of discounts and bonus offers making this even more affordable. There's really no excuse not to get yourself a copy of this years MUST read available on Amazon or directly from me. For your signed copy or to book a risk management review, get in touch today.