House Passes Bill to Stop Hotels from Fining Bad Reviews

by Enoch

It is now easier than ever to check out others’ opinion before buying something, booking a hotel, or even choosing a seat on a flight. In fact, a survey shows that nearly 70% of consumers look at online reviews before purchasing something. TripAdvisor is a common go-to place for online reviews of sights, activities, and hotels. Chances are, if you have shopped around for a hotel, you have probably looked there, and may have seen close-up photos showing conditions of a room.

In the name of protecting their businesses, some hotels are putting “gag clauses” in documents that guests have to sign at check-in. These clauses usually include language about imposing a fine or “administrative charge” for any bad reviews that the guests leave.

TripAdvisor App and Website by Amy Wardlaw

Photo by Amy Wardlaw, used with permission

Stephen Kaufer, the CEO of TripAdvisor, recently wrote an article telling the story of a customer who was fined $3,000 for leaving a bad review on the site:

This summer, a United States citizen took a vacation at a lodge in Canada.  (To protect his privacy let’s call him “Bill.”)  Bill had issues during his stay with the hotel staff, and he did what so many of us do:  he wrote about his experience online.  When his less-than-positive review was published, the hotel immediately charged his credit card $3,000 as a penalty for sharing his experience.  When Bill protested the charge, the owner pointed out that at check-in, Bill had signed a document in which Bill had unknowingly agreed not to criticize the property, or be slapped with a ridiculous fine if he wrote a negative review.

This is hardly a unique situation. Just yesterday, LoyaltyLobby reported that The Castle Hotel in the UK sends guests an email about an “administrative charge”. (Emphasis mine)

The management of the Hotel will charge an Administration Fee of £100 + VAT if the circumstances arise where a response has to be made to any comment or picture posted on electronic media which is in their opinion unfair or scurrilous in nature or to which they were not given opportunity to rectify when or after the service was provided.

I think hotels or businesses should get credit for making a good faith attempt at rectifying a problem. After all, online reviews carry a huge response bias. It’s not uncommon to see polarizing reviews, mostly just because those that thought a stay was “just average” probably wouldn’t spend the time talking about it. But on the other hand, hotels can also have highly subjective view about what is “unfair.”

Well, the House passed a bill yesterday, titled the “Consumer Review Fairness Act,” with bipartisan support. Essentially, the bill restricts businesses from writing agreements that prohibit negative reviews, or imposing fines on such reviews. Hotels are still protected, and can sue for libel, for example, under this bill. Specifically, the bill prohibits a contract that:

(A) prohibits or restricts the ability of an individual who is a party…to engage in a covered communication;

(B) imposes a penalty or fee against an individual who is a party…engaging in a covered communication;

The bill was originally introduced by Representatives Joe Kennedy III (D-MA) and Leonard Lance (R-NJ) in April. Before becoming law, this House bill and a previously adopted (and similar) Senate version would have to be reconciled, and then be presented to and signed by the President.

(HT to Skift)

The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.


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mike murphy September 13, 2016 - 8:39 am

a private entity issuing fines?

dave September 13, 2016 - 10:24 am

ridiculous. how does the hotel in question identify which customer that was? i guess some kind of exchange must have registered by hotel staff…still if you post reviews under an alias…i guess we should say we have a bad experience but hotel gag clauses in effect so cant talk about it. this should be a big black mark on the hotel.

Mike L September 13, 2016 - 10:45 am

If your credit card company wouldn’t charge back a bogus “fine” like this… you might need a new credit card company.


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