Most EE and O2 mobile phone customers will be hit with monthly contract price rises of 1.3% from 30 March 2016. But if you're affected you're unlikely to be able to leave your contract penalty-free, as annual inflationary price rises such as these are written into the firms' mobile contracts.

Here's what you need to know if you’re a customer of EE (which includes T-Mobile and Orange) or O2. You can also see our Cheap Mobile Phones guide to see if you can cut costs and find a better deal.

EE contract price rises

Whether or not you're affected depends on when you took out or last upgraded your EE mobile contract.

  • EE pay-monthly customers who started their current contract between 26 March 2014 and 9 February 2016: You will be affected by the price rises and your monthly contract will rise by 1.3% – eg, a £24.98/mth price plan will increase by 32p a month, and a £49.99/mth contract will rise by 65p a month.
  • EE pay-monthly customers who started their current contract before 26 March 2014: You aren't affected because the terms of your contract don't allow for annual inflationary price rises.
  • EE pay-monthly customers who started their current contract on or after 10 February 2016: You won't see a price rise this year, but your contract does allow for annual inflationary price rises and your first increase will occur in March 2017, if you're still in contract then.

Call costs and costs for pay-as-you-go customers are not affected.

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O2 contract price rises

All O2 pay-monthly customers are affected by the 1.3% increase – this applies to O2 Refresh Airtime Plans (but not Device Plans), Sim-only tariffs, standard tariffs and mobile broadband tariffs.

Again, call costs and costs for pay-as-you-go customers are not affected.

EE and O2 customers face 1.3% price rise in March
EE and O2 customers face 1.3% price rise in March

Can I leave my contract penalty-free?

Unfortunately if you're within your contract's minimum term you're unlikely to be able to leave penalty-free. That's because EE and O2 contracts stipulate at sign-up that monthly costs may increase each year by up to the rate of the Retail Prices Index.

However if you're no longer within your contract's minimum term, or on a rolling one-month contract, you will be free to give notice and leave.

It's also worth noting that O2 customers who signed up to their current contract before 23 January 2014 may be able to leave penalty-free (EE customers in a similar situation won't see prices hiked). That's because old Ofcom rules apply – these state you can leave your contract penalty-free if you can prove the price rise will cause you "material detriment", although there's no set definition of what constitutes material detriment.

But, in effect, with most customers on a contract of no longer than 24 months, the old rules will not apply.

An Ofcom spokesperson says: "With contracts usually only lasting a maximum of 24 months, even if a customer took out a contract a day before the new guidance came into effect, that contract would have ended on 23 January 2016 and so it would seem logical that those customers would have, by now, entered into a new contract and thereby be bound by the new 'tiered contract' terms."

So most O2 customers will not be able to exit without a penalty unless they are on a rolling month-to-month contract.

‘Outrageous’

EE and O2 customers have responded angrily to the price hikes on social media – here are a few of the tweets we've seen:

What EE and O2 say

An EE spokesperson says: "Our pay monthly plans increase by RPI annually. This year our customers will see a typical rise of less than 50p a month. We’re currently contacting our customers to remind them this will take effect from 30 March 2016."

An O2 spokesperson says: "We’ve adjusted our monthly tariff charges by 1.3% in line with the annual RPI change that we apply to our contracts each year. This adjustment means an extra charge of 22p per month for customers on our most popular pay-monthly tariff."

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