No Lock-In Surprises: Contracts, Waivers and Liability for Gym Owners

Membership agreements and unfair contract terms

Standard-form membership contracts fall within the unfair contract terms regime in the Australian Consumer Law (Schedule 2 to the Competition and Consumer Act 2010 (Cth)). Since reforms that took effect in November 2023, including an unfair term in a standard-form consumer or small business contract can attract significant penalties — not merely the risk that the term will be unenforceable. Terms that lock members into long minimum periods, allow unilateral price changes, or make cancellation unreasonably difficult can be at risk. Clear, balanced terms in plain language tend to be far more durable.

Waivers and the limits of exclusion clauses

Many gyms rely heavily on a signed waiver, but the consumer guarantees in the Australian Consumer Law cannot simply be contracted out of in every situation. There are specific provisions dealing with recreational services and the exclusion of liability — including section 139A of the Australian Consumer Law and the various state civil liability statutes, such as the Civil Liability Act 2002 (NSW) — but their operation is nuanced and varies between jurisdictions. A waiver is rarely a complete shield on its own. A more reliable approach combines a well-drafted waiver with genuine risk management: induction, qualified supervision, equipment maintenance records, signage, and appropriate public liability and professional indemnity insurance.

Direct debit and recurring billing

Recurring billing through direct debit is the financial engine of most gyms, and it is regulated, including under the ePayments Code administered by ASIC. Clarity around when payments are taken, what happens on a failed payment, and how a member cancels both the membership and the underlying debit authority helps avoid disputes — many complaints in this sector concern members who believed they had cancelled but kept being charged.