Early termination fees (ETF) from mobile network operators are out of control. I get wonky when things are out of control. Wonky equals time to get creative.
Its important to understand what is in the contract with your mobile network operator (MNO). There is a Federal Universal Service Charge (FUSC) on your bill. I promise. It may be more difficult to find on your electronic bill and will be disguised with something along the lines of, "Other Charges & Credits or Taxes, Governmental Surcharges & Fees." I will reference Verizon as that was the MNO I successfully got to drop the $400 ETF for both phones.
What is the FUSC?
This is a charge created by the FCC to fund programs that help people in rural communities get telecommunication services, help low income families afford phone service, help pay for teleconferencing systems that are used by rural hospitals, and internet access for schools. That is all really awesome except that its a hidden tax that Verizon is ultimately responsible for. MNO's pass on the surcharge to their customers. This fee fluctuates. Sometimes it decreases and other times it increases. If you notice an increase in this charge you can get out of your contract and avoid the ETF. The magic sentence is, "The rate increase has a material adverse affect on me." What an awesome yet vague legal term.I am a loophole guru. Here is my guide:
1.) Your MNO will not make this easy. Just be patient, expect to talk to multiple people, and possibly a good chunk of time on the phone with them. Be prepared. Grab your bill and a copy of your contract so you can point out the page, paragraph and lines to the reps. Sound confident. Even if your not. The rep I initially got had no clue what I was talking about.2.) Call cancellation dept: state you noticed an increase in the FUSC and tell them in your contract it states any prices changes that have a material adverse affect on you allows you to cancel within 60 days without paying an early termination fee.
3.) Don't believe them when they tell you the FUSC is not a fee set by them so there is nothing they can do because it is a mandatory government charge. Agree with them. Tell them you know this is a mandatory government charge however its a mandatory surcharge Verizon is responsible for. They will reference the, "taxes fees and surcharges we don't set," section of the contract. This is where you point to the section, "charges and fees we set." The paragraph states, "the FUSC is set by Verizon."
4.) They will claim that material adverse affects have nothing to do with price changes but to do with coverage changes. Go back to original paragraph that states, "we can also change prices and any other conditions in this agreement at any time." further down it states, "if the changes have a material adverse affect on you then you can cancel within 60 days without paying an early termination fee.
5.) Now they will try to claim the change does not have a materially adverse affect on you because it is only a matter of a few pennies. You can get a little defensive here. Verizon can not tell you what materially adverse is because they have no idea what your financial situation is. If you are good with numbers try and slam them with the percentage approach. A few cents could be a 30% to 40 % increase because if this happens every months those pennies add up.
6.) They will offer a credit because this negates the material adverse affect because now you are not losing any money. Get ready for the hardest argument. Point out that in the contract nothing states that they can negate the affect; though it does say if the affect happens then you can cancel your contract. Another approach is to point out that they are admitting to the affect happening because they saying they are negating the affect. Then politely remind them they cant change rules of contract after both parties have signed it.
Submitted by Cullen McManus
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