Ouch! An Evergreen Clause in a Service Contract Can Hurt your Business

Posted on Jul 16, 2012 in Jeff Nolte's Blog

Recently, Chesapeake worked with two customers who ran into trouble as they were looking to make some changes to their network services.

They wanted to improve their call handling and reduce their phone bill costs. Unfortunately, they did not know they had an “evergreen” clause in their contracts.

No, this doesn’t refer to a fresh pine scent you may encounter in the great outdoors… It is contract language that can put your business in a bind if you’re not careful. An evergreen clause goes something like this:

“Unless notified within 90 days of contract expiration date of intent to cancel services, contract will automatically renew for the same term at the same rate.”

It is important that you review your telecom services contract, and look for this kind of language.

If you do not have a copy of your contract, call the customer service line for your carrier and ask them for your termination date, and if there is an “evergreen” clause in the contract. Get it all in writing.

Not knowing this information could cost your company thousands of dollars that could have gone into more productive pursuits!

Our network services experts can help you cut your phone and Internet bills. Contact us today: (800) 787-4848 or email jnolte@chesapeaketelephone.com.