To Refund or Not to Refund? And the Value of a Signed Release
I was recently speaking with one of my law partners who's a seasoned trial lawyer. She was telling me about some fascinating research showing that the doctors who are most likely to be sued are those with poor bedside manner. In other words, two doctors may make the exact same medical error, but the one with poor bedside manner is more likely to get sued than the doctor who shows genuine care for patients. Does this not hold true for camp as well?
My view when it comes to refund requests is typically that camps are better off giving a refund than withholding a few thousand dollars and then having a family that's going to pursue an online vendetta against camp (or, even worse, step foot into a plaintiff attorney's office). The reputational harm caused by negative reviews may not be worth the amount you'd ultimately refund.
I appreciate, of course, that by the time a family is asking us for a refund, we've already spent the money they're requesting back. We've hired the staff, bought the food, invested in upgrades, and otherwise made financial decisions based on the number of enrolled campers. However, if one unhappy family leaves negative reviews across online platforms, we may stand to lose much more than we would refund to that family. Online consumers often don't have the attention span to investigate the legitimacy of a review. They just see something that's less than five stars and automatically come to various conclusions.
Reviews aside, if you withhold a refund, you also make it more likely for a family to walk into that plaintiff attorney's office. There's a saying in litigation that "Even when you win, you lose" because it's so expensive to defend even a groundless lawsuit. If we can talk a family off the ledge by offering them a refund, then we're likely doing ourselves a favor by taking one big step to avoid litigation.
Indeed, depending on the details of the situation, you can go a step further by giving a refund and then offering the family free camp next summer. It's an offer that shouldn't be made lightly -- we're running a business, after all -- but bedside manner doesn't get much better than that. And if an unhappy family feels heard and validated, gets their refund, and then agrees to come back to camp (albeit for free), then we can venture a guess that the family is exceptionally unlikely to sue you in the meantime.
So let's assume you do choose to give the refund. How do you ensure that a family won't leave a negative review anyway or, worse yet, pursue litigation against your camp? While there are no guarantees, one significant tool in your arsenal is having the family sign a simple release addressing exactly those concerns -- the relase can say that they won't sue you, they'll keep the refund confidential, and they won't leave a negative review online. If a family is asking for a refund, then you're well within your rights to ask for those things in exchange.
With all that said, a negative review isn't the end of the world, and a camp with a long history and strong reputation may simply not care what an individual family writes online. In this case, the best antidote to a negative review is a steady stream of positive reviews from all your happy families throughout the year.
But if you do opt to give a refund, consider having the family sign a release!