Telstra Didn’t Pay Millions of Dollars in Customer Compensation
Tech Updates

Telstra Didn’t Pay Millions of Dollars in Customer Compensation

Telstra faces legal ramifications for delaying payments totaling 11 million dollars to 67,000 customers.

Telecommunications regulator, the Australian Communications and Media Authority (ACMA), revealed on Friday that Telstra would undergo an independent review of its compliance standards due to violating the rules.

Telstra Didn't Pay Millions of Dollars in Customer Compensation

The payments relate to a fee payable by the telco for exceeding the agreed deadlines for the installation and repair of fixed lines between July 2017 and June 2021.

Telstra has repeatedly violated industry rules by failing to meet agreed deadlines and taking more than two weeks to decide whether to accept liability and pay the required damages.

“Telco customers are entitled to compensation for landline delays or outage repairs,” said ACMA President Nerida O’Loughlin.

“Telstra has let its customers down by failing to pay compensation on time.”

Camera Icon Thousands of Telstra customers were not properly compensated after waiting for fixed installations and repairs. Glenn Ferguson Credit: News Corp Australia

Telstra reported the error to ACMA, blaming an “IT error” on customers who were not compensated when they should have been.

“After this, we delved deeper into our systems to verify CSG (Customer Service Guarantee) payments, and this identified several other cases where payments had not been made,” a Telstra spokesperson said.

“We handle millions of customer transactions weekly, but this is clearly not the experience we want to offer our customers.”

The company has since paid $11 million in compensation to customers and is also required by law to implement an enhanced payment review solution.

It is not the first time that Telstra has violated the regulator. Last year, the company paid a $2.5 million fine for violating customer privacy laws.

In April of this year, Telstra paid an additional $2.2 million in refunds and fines after overcharging 10,000 customers for a total of $2.5 million over 12 years.

Camera icon The company is undergoing a legally enforceable review of its compensation processes after being accused of an “IT error” for the error. NCA NewsWire / Dan Peled Credit: News Corp Australia

“Telstra knows it has had a problem with its internal systems and processes…the company has self-reported these and other recent breaches,” Ms. O’Loug. hlin said.

“It is critical that Telstra addresses these long-standing challenges when building new systems and processes and, where required, compensates its customers for historic telecom rule violations.”

She added that telcos accept the responsibility to pay damages when liability is an important step in treating customers fairly.

The ACMA will continue to monitor Telstra’s progress in updating systems and processes over the next two years.