Health

Gyms Won't Let Customers Cancel Memberships Despite Stay-at-Home Orders

Multiple fitness chains are charging extra fees during pandemic closures, and some are making it even more difficult than usual to leave contracts.
April 21, 2020, 8:02pm
GettyImages-Rows of empty treadmills at an upscale health club.

Sarah Dabous went to her New York Sports Club gym in Bay Ridge, Brooklyn in late February to cancel her membership before heading back to college in Staten Island. She didn’t have time to go to the gym between work and classes, she said, and wasn’t a fan of the machines. At the gym, Dabous said she signed a set of forms and paid a $10 cancellation fee. When she saw a bill for $20 from NYSC in early April on her credit card statement, she figured it was “another cancellation fee of some sort.”

Then on April 6, well after Governor Andrew Cuomo ordered all gyms to close themselves to customers due to the COVID-19 pandemic, a charge from NYSC for $59.99—$10 over her monthly membership fee—appeared on Dabous’s statement. “I knew by then that something was up,” she said. Dabous said that since finding the charges, she’s tried multiple times to get in touch with the gym, which closed in mid-March in compliance with Governor Andrew Cuomo’s statewide shutdown order, with no success.

“I tried calling them on every number, and all phone lines are non-functioning,” Dabous said. “I tried emailing them multiple times, sending them messages multiple times. Nothing, absolutely no [response] beyond an automated email response saying that they ‘will look at each message soon.’” A spokesman for Town Sports International, the parent company of New York Sports Clubs and its sister gyms in Boston, DC and Philadelphia, looked into these charges at VICE's request, and claimed that, despite the inconsistent amounts, the charges were legitimate due to the company's 45-day cancellation policy and the annual fee for Dabous's membership.

The problem of gyms charging fees to customers who have no access to their gyms, or who have even cancelled their memberships with those gyms, extends beyond TSI. LA Fitness and 24 Hour Fitness—the number-one and number-three top-earning fitness club companies in the country in 2018 (Town Sports was ranked seventh)— are also facing lawsuits from members. A suit filed by a woman in California at the end of March charged that 24 Hour Fitness continued to bill her card and not refund her membership even after its gyms around the country closed. (24 Hour Fitness said in a statement that it does not comment on pending litigation.) A gym-goer in Florida also filed a lawsuit at the end of March that stated LA Fitness “refused” to refund its members after its locations voluntarily shut down in mid-March.

Dabrous is not alone in her frustration. TSI has come under fire during the coronavirus pandemic for its handling of how it has shut down facilities and continued its billing practices. Since mid-March, members in these cities have said that their gyms continued to charge them through March and April, even as locations are shuttered, and are not responding to emails or calls to customer service lines. TSI also laid off “all non-executive employees” during the pandemic.

NYSC was hit with a class-action lawsuit in late March alleging that it continued to bill members for services even after gyms were ordered closed on March 16 as part of Gov. Cuomo’s larger statewide shutdown. In early April, customers of Boston Sports Club filed a lawsuit with similar claims, while the Attorneys General of Pennsylvania, New York, and DC issued a joint letter to TSI’s CEO demanding it freeze memberships.

Since the wave of legal action, NYSC and other TSI gyms have said they would freeze memberships and credit members for time charged after gyms reopen, while the suit in Boston has been dismissed. The DC Attorney General’s office has said it is “working with TSI to address some remaining issues"; a TSI spokesperson said that, despite challenges caused during the pandemic, they believe all concerns will be resolved.

Aya Awad thinks she wants to keep going to the Forest Hills Lucille Roberts, which is owned by TSI, after it reopens—she likes the Zumba and yoga classes. But she was laid off in March, she says, and would rather have a refund than the credited time the gym has promised.

“I don’t want to cancel my membership,” she says. “I just want to not pay during the quarantine.”

TSI has had a history of legal problems concerning its billing practices. The DC attorney general investigated the company in 2016 for not allowing members to cancel in-person; two years later, more than 60 members filed lawsuits alleging that the company was continuing to charge them for memberships they thought they’d stopped.

Last year, the DC AG sued the company again, alleging that it deceived people about how to cancel their memberships—sometimes, as the suit stated, continuing to charge members for years after they thought they’d cancelled. (A TSI spokesperson says the company is confident it will prevail in the active suit.) In the past, LA Fitness faced at least one other lawsuit in 2016 for misrepresenting monthly membership terms and withdrawing money from one user’s account.

Hefty monthly membership bills and mystery charges aside, it’s a rough time to be a mid-level fitness chain. Before coronavirus, the fitness industry was increasingly growing in two separate directions. Super-budget options that offer memberships as low as $10 a month, like Planet Fitness and Blink Fitness, were becoming increasingly popular, while customers were also gravitating towards boutique studios like Equinox and SoulCycle.

The economics of big gyms are pretty simple: Many gym chains are simply depending on you to not show up. About 80 percent of gym memberships go unused, industry data shows, while recruiting a new member for gyms is twice as expensive as retaining an existing one.

It’s easier to forget about a monthly $10 Planet Fitness charge, or justify a pricey but rarely-used membership to SoulCycle for the cachet and cool gear. But mid-range gyms like NYSC, which has an average membership price of $50/month, have had a hard time keeping members who either want the most bang for their buck or a boutique experience. Both TSI and 24 Hour Fitness saw a decline in both new membership sales and a decrease in members in 2019.

TSI executives knew they needed to diversify to survive. The company announced in January that it would be buying Flywheel, a SoulCycle-like chain of indoor cycling studios, saying it would arrange for its members to be able to access some Flywheel options (and giving Flywheel members similar access to TSI gyms). The deal has fallen apart this month as TSI faces mounting financial problems.

As the lockdowns across the country drag on, the future looks bleak for fitness chains of all kinds. Gyms are grappling with how they will keep their spaces safe and clean, lure back customers, and earn new ones as the pandemic persists. Already the cracks are starting to show: Gold’s Gym, another mid-priced chain, said last week it would be permanently closing more than 30 locations around the country. Meanwhile, 24 Hour Fitness and TSI are both reportedly considering bankruptcy.

But the circumstances, however unusual, don’t merit misleading customers. After she cancelled her NYSC membership, Dabous started going to Planet Fitness, which sent her an email a few days after New York’s lockdown to tell her it was freezing her membership. She said she hasn’t seen a charge since.