Compensation Culture


All of us will have been let down by a company at some point. Maybe we’ve been left stranded at an airport as a flight is cancelled because of snow, maybe someones birthday present we ordered online arrived too late, or maybe what we’ve bought is just poor quality.

In these cases what is the least we’d expect? Most likely it will be to have either the company put things right or for the money we paid to be refunded in full, but should we expect more than this?

It seems that a growing number of people are demanding more. I’ve had two customers this week for whom a full refund and apology is just not enough. The word they both used was “compensation”

Customer A had ordered an item which had arrived late and when it did arrive the parcel had been squished beyond recognition. I apologised and offered to either replace the item or give a full refund. Customer A responded that she was “disgusted” by her experience with the company and indicated that she was just not happy with this settlement. She had wanted a replacement and a full refund as “compensation”. She said she would also have to tell people how poor our company is. I pointed out that in fairness it seemed to me that the parcel had probably been damaged in transit which seems to be corroborated by its late arrival (most likely it had spent 2 days under a mountain of other parcels). I said that I imagined it left the warehouse in good condition. The response was that the company should make sure that the packaging was better, that parcels were tracked etc.. I declined to comment further deciding that this was a lost cause and offered her the refund or replacement with the option of speaking to a manager if she wanted to discuss the compensation issue further. She took the refund.

Customer B had also experienced a delay receiving his order. This time it was because he failed to supply a certain bit of information which was required. As per usual procedure he was sent a letter asking him to get in contact with us, which he did, but was unhappy as he felt we should have telephoned as we had his number and in any case it should all have been done much sooner. He did have part of a point here, but in mitigation his order had come in in the busiest part of the year by a long way. Customer B had previously discussed compensation and had, I told him now been refunded the postage costs for the order which had recently also been dispatched. He asked how much this was and upon hearing it would be around the £2 mark he expressed his displeasure “you’re having a laugh” he told me. Customer B also expressed his displeasure that no one had told him about this before, he’d been expecting a call. Again he had a point here someone should have called.

Customer B asked me if I felt he had received good customer service and if I felt the amount offered was sufficient enough to mitigate this. For a second I thought of getting into a deep philosophical discussion about whether our expectations about what we are offered if things go wrong have increased and whether we now expect too much, but I sensed this wasn’t the guy to have that with I’d just have to save it for the blog.  This situation was as I saw it a 50/50. If it had been a minor shunt between two cars in a car park, both parties would have just walked away with a slight feeling of shame. Unfortunately Customer B was not of this ilk. He worked in “the media” he somewhat threateningly said. He had a book full of contacts and would publicise this poor service. I decided now was probably the time to hand him over to a manager.

Both sets of exchanges seem to be getting more common. Once an unhappy customer would simply cry out  “I want my money back”, but now customers want to enter into complex negotiations for a ‘compensation’ package.  Whats more they seek to enhance their negotiating position with the threat of resorting to the internet to damage a companies reputation (just look at the trip advisor debate to see how emotive the issue of customer reviews on the net can be).

I wonder what the cause of this is. Is it a case of “compensation culture” spilling over, a case of the bar being set higher by some companies, or an effect of the rhetoric and vocabulary of the slick machine that is the customer service industry. It could be all of these, but one thing for sure is it isn’t down to a change in the law. The law is clear on these issues, a full refund is the maximum a company must legally offer.

Should they do more?

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2 thoughts on “Compensation Culture

  1. What a great blog! Glad I found this (after you found me). I think working in a call center would be one of the worst jobs for me, as I always try to please people and tend to agree with them. So it’s great to see how you deal with unsatisfied customers.

    I’ll subscribe and see what you’re up to next.

    Hope you manage to do a bit of bloggiesta too.

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