The leaf on the track is no longer! London’s financial district commuters can now take train companies to court

The definition of banality, and the type of compensation for poor service which would only be welcomed by a masochist: Train companies in the UK which provide an unreliable service, cause thousands of City executives in London’s financial sector to be late for work, or give up on their journey and head home to work remotely, and then offer their passengers the chance to ‘enjoy’ the same experience by way of a free ticket as a response to complaints.

With the train companies having for so long had the whip hand over the very people that they serve – largely commuters into the Square Mile’s financial district – the status quo is about to change as new laws are being introduced in which passengers may be able to overturn the current policy which allows passengers to claim the cost of half of a single journey for delays of more than half an hour, or the full one way ticket price if held up for over an hour.

Currently, full refunds are payable if the entire service is canceled, and the refunds are not real refuns – they are travel vouchers, and must be requested by the passenger as the train companies do not issue them automatically.

All this really means is tht ther is no refund for any journey (or non-journey) in modern-day commuterland should you not make it to the office, and no accountability for your wasted time or lost work.

The combined cost to financial institutions and their associated ancillary service providers such as technology vendors, professional services consultancies and external suppliers as a result of late or canceled trains is huge, and ultimately there is no recourse financially for those who use the trains or the companies in the City whose key personnel cannot make it to the office.

Let’s imagine that you are a senior executive at a large British electronic trading company such as IG Group, ADS Securities or CMC Markets, for example, and you have a visit from an international Tier 1 bank that provides liquidity, and a simultaneous meeting with a prime brokerage, both whom may have flown from New York for the pre-arranged meeting, and then you go to the train station in the morning to get to the office to find that the train does not arrive.

You then have two options – those being to take a taxi, but because the trains are not operating accordingly, the road traffic going into the City, which is only one square mile in size and has very narrow streets, would mean a very long journey, most of which would be conducted at less than 10 mph.

The other option is to go home, get the car and drive, however even if you know London’s residential streets so well that the traffic jams could be mitigated, the City of London is notorious for being the world’s fiscal powerhouse, home to the vast majority of institutional firms and banks, and with tens of thousands of executives from outside London and overseas making business trips each day to the City, yet there is nowhere to park, thus trains are an integral part of the City’s business infrastructure.

“Seventeen minutes late, defective bogey at Earlsfield.” – Reginald Perrin

The end result of this scenario would perhaps mean that the meeting would not proceed or be delayed, thus causing tremendous cost which would then be borne by the companies and their executives as the train companies wring their hands.

Transferring the responsibility of less than optimal service onto its customers has long been the preserve of train companies, however good news for City executives may now be on the cards as this is set to change.

The new rules will allow passengers to demand all their money back if they believe the compensation offered is inadequate – or they believe they deserve a full refund as the service fell well short of what they had expected.
This could include being a victim of severe overcrowding caused by a rail operator not offering sufficient carriages.

Mike Hewitson, head of policy at consumer group Transport Focus, says: ‘The question you must ask yourself is, “Would I have bought this service had I known that?. If the answer is “No” you are likely to have a case under the Consumer Rights Act. But until the law has been tested it is hard to say just how far courts will go in supporting claims.”

From October 1 this year, customers of train companies in Britain can take their case to the county court if they are not happy with the way that the train operator handled their complaint.

Being able to go down that path of litigation means very cheap (approximately £25) self-representation in small claims court that would also allow executives and employees who have endured some kind of cost to their business as a result of the late train, as in my fictitious scenario above to sue the train company and hold them to account for lost meetings, inconvenience caused to external firms who traveled to do business and were unable to be met by their commercial host due to a canceled train.

It could be considered that such claims would be upheld by a county court judge because London is a special case in which no alternative method of transport would work – driving is not an option as the meeting would be ancient history by the time the employee arrived at the office and a whole day’s work would be lost – and the official train timetables are publicly available meaning that a ticket bought for a specific train is a legally binding contract between passenger and train operator, thus ‘allowing time’ in case of late or canceled train would likely not be a good defense.

One in five of all the trains run by Govia Thameslink Railway – owner of Southern Railway – were more than five minutes late in the past 12 months, with one in 20 cancelled, and whilst the new legislation will likely not improve the passenger experience, it will make the train companies accountable for failing to get their passengers to their destination on time.

Last year, Network Rail was fined £50 million by the Office of Rail Regulation for late trains, yet the policy remains that customers are not refunded and no accountability is offered.

One particular commuter took a train company to court last year as his patience ran out after spending £5750 per year traveling to work from Colchester (Essex) to Central London and having been delayed 60 times during the course of a year on what is supposed to be just a 50 minute journey.

This particular executive was awarded £1090 in compensation as the court found in his favor, however as of October 1 it may well be that the train companies would have to pay for any damages caused plus make full refunds of tickets if their services are not provided according to what the customer is paying for when buying a ticket.

Good news indeed for London’s financial sector, and maybe a potential move toward leveling the vast difference in ethos between London’s top quality, highly advanced City environment with its world leading interbank sector, institutional electronic trading companies whose employees work tirelessly and accurately to serve the world’s markets, and the retail giants of the square mile, when compared to the trade union-orientated stubbornness and culture of entitlement that engulfs the rail companies.

No more leaves on the line or wrong kind of rain….