Responding to a “flood of airline service complaints” during the pandemic, the US Department of Transportation on Wednesday proposed rule changes to make it easier for airline passengers to collect refunds for canceled or delayed flights.
As travel demand has reached near pre-pandemic levels, airlines have admitted they often lack the staff needed to operate flights, causing a rise in cancellations and delays – and complaints from travelers who say airlines have been slow to offer refunds.
Current rules require US airlines to pay refunds and flight vouchers for cancellations and “significant changes” to flight schedules, but do not clearly define what “significant changes” mean. As a result, refund policies vary between airlines, according to consumer advocates.
“This proposed rule would protect the rights of travelers and help ensure they get the timely refunds they deserve from airlines,” US Transportation Secretary Pete Buttigieg said in a statement.
Under the proposed rule, a “significant change” can mean a change in departure and/or arrival time of three hours or more for a domestic flight or six hours or more for an international flight. The definition of “significant” also includes a change of departure or arrival airport, an increase in the number of connections and a change in aircraft type if this means that the passenger experience is degraded.
Under the new rule, flight credits or vouchers would be valid indefinitely when passengers cannot fly for pandemic-related reasons, such as a government-imposed travel ban or border closures. The rule also requires airlines to pay refunds, rather than travel credits or vouchers, if the company “has received significant pandemic-related government assistance.” Most of the nation’s largest carriers received funding in 2020 and 2021 under the Coronavirus Aid, Relief and Economic Security Act to avoid mass layoffs.
“I am pleased that the Department of Transportation is now addressing this issue,” said Charles Leocha, president of Travelers United, an airline consumer advocacy group. But Leocha would like the agency to go further by shortening the three-hour window to change domestic flights to 90 minutes.
The Department of Transport fined Air Canada more than $2 million in November 2021 for what the agency described as “extreme delays” in reimbursing thousands of consumers for flights to or from of the United States which have been cancelled. The agency says it is pursuing fines against 10 other airlines for similar delays in paying refunds.
A spokesperson for a trade group that represents that country’s largest carriers declined to comment on the proposed rule, but said the airlines “provide the highest level of customer service and are committed to working with travelers to meet their individual circumstances”.
US airlines issued nearly $13 billion in cash refunds in 2020 and more than $8 billion in 2021, according to trade group Airlines for America. Complaints about refunds among airline passengers have been declining since May 2020, according to the group.
The airline trade group issued a statement last month admitting that carriers are still struggling to overcome pandemic-related issues.
“Our country’s ‘new normal’ has a steep learning curve, and American airlines are adapting and implementing long-term solutions as quickly as possible to keep things running smoothly. We recognize that our work is not over, which is exactly why we will continue to listen to our customers and take action to show our commitment to safety, service and you,” the post said.
Despite rising demand, airlines are struggling to return to the financially rosy pre-pandemic times when most carriers reported record profits. In the first quarter of 2022, US airlines reported a net loss of $5.1 billion, according to the US Bureau of Transportation Statistics.
The Aviation Consumer Protection Advisory Committee, a panel that advises the Department of Transportation, will hold its first hearing on the proposed rule on August 22 in Washington, D.C., but anyone interested can attend the meeting via Zoom after registering by line. Members of the public can submit comments on the proposed rules at www.regulations.gov, file number DOT-OST-2022-0089.
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