Many businesses over recent years have fallen victim to paying over the odds for their energy bills, and they could be owed thousands in compensation.
With the energy market being such a dynamic and complex landscape, it’s not uncommon for businesses to enlist the help of an energy broker to secure them a deal. As many as 70% of businesses go down this route, but some of these brokers haven’t always been honest about the commissions they gain from their customers.
By using secret tactics to gain undisclosed commissions, businesses have found themselves covering these fees hidden within their contract without knowing it, leading to substantial financial strain.
Our recent blog on understanding undisclosed energy commissions covers the what, how and why behind this scheme, but in today’s article we’ll take a look into the eligibility criteria and how to know if you’re able to claim.
How do I know if my energy contract has undisclosed commissions?
It can be difficult to figure out if you’ve been paying for your energy broker’s hidden fees, particularly as they use smart tactics to ensure their commissions go unnoticed. It’s likely that they won’t have provided any information about how much they’ve been paid, and may have even offered their services to you as ‘free’.
However, there are a few telltale signs that may indicate signing your business energy contract wasn’t entirely above board:
- Lack of transparency: If your broker did not disclose any information on the commissions they were receiving or did not make you aware of the fees associated with their services, this is a form of deception.
- Minimal contract options: If your broker failed to present a range of different contract options catered to your needs, it’s likely that they chose the supplier that would generate the highest commission and therefore worked towards their own financial gains.
- High-pressure sales tactics: If your broker was forceful when trying to coerce you into signing the contract i.e. pressuring you into signing a deal under the pretence that it’s only available for one day, it’s possible they were pushing for the contract that would get them the best fees.
All of the above scenarios indicate that your chosen energy broker was acting in a way that drove their own financial motives as opposed to benefitting you as a client. As a result, you have likely been paying a higher unit price to cover their commission fees whilst being entirely unaware of the situation.
Determining your eligibility
The business energy claims criteria is straightforward. If your business used a broker for a commercial energy gas and/or electric contract between 2000 and 2022, and their interest was not declared on any document relating to your contracts, then you have grounds to make a claim.
A 2020 investigation into energy brokers by the Office of Gas and Electricity Markets (OFGEM) estimated that 90% of micro-businesses using an energy broker were likely to have fallen victim to the hidden commission scandal.
By law, energy brokers have a fiduciary duty to ensure that their client’s interests don’t conflict with their own, so if your energy broker did not act in good faith or disclose this financial information to you, you are eligible.
How much is my claim worth?
Each case is unique, and the potential compensation for your business energy claim will depend on various factors including the exact value of the commissions and the financial impact it has had on your business.
As a general rule of thumb, you could expect to recover any financial losses alongside reimbursement for any additional damages that happened as a result of the stress and inconvenience. A successful claim can be worth anything between £1,000-£500,000 depending on the individual circumstances.
Specialised claims solicitors can assess your case and determine how much you may stand to win before carrying through with the claim.
What happens if I lose my claim?
In the unlikely event that your business energy claim isn’t successful, you won’t be expected to cover any legal costs or suffer any consequences as a result of your claim.
Your business will be protected by an ATE (After the Event) Insurance Policy, which will ensure that any legal costs are covered, ensuring minimal risk in pursuit of damages owed to your business.
How can FDM Solicitors help?
Making a business energy claim can be a complex and time-consuming process without the right help. Our team of claims solicitors have the legal expertise needed to navigate the complexities of your case, increasing the likelihood of success.
We’ll conduct a thorough assessment of your situation, determining the strength of your claim and advising on the potential compensation you might be entitled to. From there, we can initiate the claims process and negotiate with energy suppliers or brokers on your behalf, to secure a fair settlement.
In the event that your case does need to progress to court, we will issue formal court proceedings on your behalf and pay for a barrister to represent you and your claim. We operate on a no-win, no-fee basis and support you through the entire process to ensure you get the compensation you deserve.
If you believe you have been the victim of an undisclosed energy commission scandal, we can help. Whether you’re a sole trader, small business or large corporation, click here to start your business energy claim or get in touch with us on 0333 360 1724 to get further advice from one of our expert solicitors.