> For the complete documentation index, see [llms.txt](https://docs.podplay.app/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.podplay.app/payments/what-is-a-cancellation-policy.md).
# Cancellation Policy
### Overview
A Cancellation Policy is a rule that incentivizes Customers to cancel their Reservations or Event attendance as early as possible. When a Customer cancels at the last minute, the Club is left with a court or table that another Customer could have booked. That missed sale is lost inventory (inventory = court or table time). A Cancellation Policy with early-cancellation incentives lets the Club recover that lost value with another Customer booking.
After years of testing, the default cancellation policy is:
* 10-minute grace period after booking: free
* 24 hours or more in advance: free
* Less than 24 hours in advance: full cost
When a Customer books a Reservation or joins an Event by mistake, there is a 10-minute grace period in which they can cancel for free. This grace period is independent of the cancellation policy, and can be removed if desired.
{% hint style="warning" %}
**The 10-minute grace period does not apply to Reservations or Events that start within 40 minutes**. If a Customer books something starting in 20 minutes and then cancels, they are charged, regardless of the Club's cancellation policy.
{% endhint %}
### Reservations vs. Events
There is a slight difference between the two policies and how they apply.
#### Reservations
**The Reservation cancellation policy** is set once, during onboarding if unique, inside the Company Settings page. You can edit the Reservation cancellation policy in the Company Settings page of the Dashboard if you have the Owner role.
#### Events
**The Event cancellation policy** can be set inside each Event during [Event creation](https://podplay.gitbook.io/docs/events/create-an-event), or on the Settings tab after the Event programmed. Event cancellation policies can be changed on a whim and range from 1 month - a few hours in time.
It's very simple for both the Customer and an Admin to [cancel a Reservation](https://podplay.gitbook.io/docs/reservations/cancel-a-reservation) or an Event.
{% hint style="info" %}
**When a Customer cancels** a Reservation, your App's cancellation policy will apply.
**When and staff cancels** a Reservation from the Dashboard, the system presumes the Admin knows what is best and no cancellation policy is applied (meaning, it is free of charge).
{% endhint %}
#### [Event Signup Cancellation Penalty](https://docs.podplay.app/system-restrictions/general-restrictions/reservation-and-event-restrictions#event-signup-cancellation-penalty)
The Event Signup Cancellation Penalty charges Members who cancel an Event signup inside the cancellation window. Without it, a Member whose signup cost $0 (by price or by a [Play Pass](https://docs.podplay.app/play-passes/play-pass-overview)) cancels late for free, and the Club loses the spot. With the penalty ON, a late-canceling Member is charged the Non-member Admission Rate instead.
Meaning, the Member's Admission rates become irrelevant and the penalty always equals the Non-member Admission rate.
| Member Admission Rate | Non-member Admission Rate | Member's Late cancellation charge |
| --------------------- | ------------------------- | --------------------------------- |
| $0 | $10 | $10 |
| $5 | $20 | $20 |
| $15 | $30 | $30 |
#### Turning the penalty on
The penalty is OFF by default and can be set at two levels:
* **Company Settings:** The Owner role can turn the `Event Signup Cancellation Penalty` toggle ON in the Company Settings page of the Dashboard. This setting is the default for every Club location in the Environment.
* **Venue override:** Each Club location inherits the Company Settings value unless a Venue override is set for that location. Contact the PodPlay CS team to change the Venue override to turn on or off this setting for only one location.
#### What the penalty applies to
* The penalty applies to Events only. Reservations are not affected.
* The penalty applies to every Membership tier.
* The penalty applies only when the Customer cancels. When staff cancel a signup from the Dashboard, no fee is charged.
* The penalty does not charge no-shows. Use the No-Show Fee for Customers who don't attend.
* Non-members are charged their normal Admission Rate for a late cancellation, with or without the penalty.
* A Member who used a Play Pass and cancels inside the window loses the Play Pass and is charged the cancellation fee.
{% hint style="warning" %}
The penalty relies on the Non-member Admission Rate. If an Event has no Non-member Admission Rate above $0 (common on Members-only Events) and no custom cancellation fee, there is nothing to charge and the Member cancels for free.
{% endhint %}
#### Setting a unique cancellation fee
***When the Event Signup Cancellation Penalty is turned on***, Events have a cancellation fee field in its settings.
When the field is blank, the penalty charges the Non-member Admission Rate. When you enter an amount, that amount applies to everyone: both Members and Non-members are charged it when they cancel inside the window.
You can change the fee at any time and per Event:
* Set a nominal fee (for example $3, $5, or $10) to discourage late cancellations without charging the full Admission Rate.
* Set the fee to $0 to let both Members and Non-members cancel for free.
{% hint style="info" %}
The fee is fully adjustable after the Event is live. You can start at $0 and raise it later, or lower it for a specific Event.
{% endhint %}
#### Why set the fee below the Admission Rate
A cancellation fee lower than the Admission Rate rewards canceling over no-showing. A Non-member with a $15 Admission Rate who no-shows is still charged the full $15. If that Non-member cancels instead, they are charged only the cancellation fee (for example $10). The spot opens for another Customer, and the canceling Customer pays less than a no-show would.
#### Pairing with [No-Show Fees](https://docs.podplay.app/events/create-an-event/no-show-fees)
Use the penalty with the `No Show` fee button above the Event's attendee list. Pricing a cancellation lower than a no-show gives Customers a reason to cancel and free their spot rather than not showing up.
#### Rolling out the penalty at a Club
{% hint style="success" %}
*Customers react poorly to a fee they didn't know about*.
{% endhint %}
Announce the change before turning on the Event Signup Cancellation Penalty:
1. Choose the cancellation window and fee for your Events. A 24-hour window is common
2. Tell Customers about the new cancellation and no-show fees and the date they start (some time in the future)
3. On the start date, turn the penalty ON in Company Settings (or ask the PodPlay CS team to set the Venue override for a single location)
4. Update the Event Reminder Email ([Company Settings](https://docs.podplay.app/owners-playbook/build-your-club/company-settings)), the cancellation policy in each Event description, and the cancellation pop-up copy so they match the new fees
5. Have staff charge [No-show fees](https://docs.podplay.app/events/create-an-event/no-show-fees) consistently from the attendee list
#### Testing the penalty
1. Create a test Event with a Member Admission Rate above $0
2. Confirm the Event has a Non-member Admission Rate
3. Sign up for the Event as a Member
4. Cancel the signup from the App inside the cancellation window
5. Open the Customer's Profile and check the Purchases tab for a `Cancellation Fee` purchase at the Non-member Admission Rate
### Timing of Charge
The cancellation fee is charged at the moment the Customer cancels. This is different from a normal Reservation, where the system waits until after the Reservation ends to bundle charges together. Because a canceling Customer is no longer visiting the Club, the system does not expect any further charges to bundle, so it captures the charge right away.
#### Stripe Processing
Every Customer transaction carries a Stripe fee. Because the cancellation fee is a charge, it carries a Stripe fee like any other transaction.
### Where to See Charged Cancellation Fees
Every charged cancellation fee appears as its own `Cancellation Fee` purchase. You can find it:
* On the Customer's profile, under the Purchases tab
* In the Purchases section of the canceled Reservation or Event
* On the Orders page, using the `Cancellation Fee` filter
The purchase shows the fee amount, tax, and payment status, so front desk staff can answer "what was I charged for?" without digging into the original Reservation's charges.
### Handling of Passes
If a Customer used a Pass for the sign-up or booking:
* **Cancel outside the window** and the Pass is returned to the Customer (so long as said Pass is still viable and has not expired).
* **Cancel inside the window** and the Pass is not returned.
### Cancellations with Bill Splitting
Two situations come up with cancellations on a Reservation that uses Bill Splitting:
1. The Reservation Holder cancels the whole Reservation
2. An invitee cancels their own participation
When the Reservation Holder cancels the Reservation, only the Reservation Holder is charged, if a charge applies. This is true whether or not their invited friends accepted the invite. Making only the Reservation Holder responsible for the cancellation fee gives the other Customers they were going to play with a chance to book another court.
{% hint style="info" %}
A Customer may call the Club and ask an Admin to cancel the Reservation so there is zero cancellation fee. It is up to the Club whether to allow Admin intervention. When an invitee cancels their participation, that invitee is not charged a cancellation fee, even within the cancellation window. For example, if a Customer books a Reservation, invites three friends, and one friend cancels, that friend pays nothing. This gives the Reservation Holder a chance to invite another Customer and fill the empty spot.
{% endhint %}
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