U.S. Dept of Transportation Issues New Ruling Protecting Consumers; Provides Cash Refunds for flights
Note: The content provided in this post is for informational purposes only and should not be considered legal advice. Please read disclaimer at the end of the article.
Yesterday was a huge win for airline consumers and not necessarily the greatest for the airlines. According to their website, the U.S. Department of Transportation is requiring automatic refunds to consumers when a U.S. or foreign air carrier cancels or makes a significant change to a scheduled flight to, from, or within the United States. These refunds will occur when the airlines are at fault, and the consumer is not offered or rejects alternative transportation and travel credits, vouchers, or other compensation. These refunds must be made within 7 days.
The mechanics of the refund process will take about six months to implement. So, don’t go thinking you’ll get a refund during the busy summer travel season if your flight is cancelled. Most likely, it won’t be until late fall 2024.
This stems primarily from the Southwest Airlines debacle during the 2022 holiday season, where it canceled about 15,700 flights, charged exorbitant fees and consumers experienced significant refunding issues. Since then, the Department of Transportation has been working with the airlines, the International Association of Travel Agents (IATA) and other entities to protect consumer rights, while keeping the airlines accountable, competitive and operating as safely as possible. Southwest, in efforts to enhance customer service, is reportedly ahead of other airlines in implementing this process, potentially providing them with a competitive advantage.
Transportation Secretary Pete Buttigieg held a press conference announcing a ruling noted as the, “biggest expansion of consumer rights in history.” Sec. Buttigieg begins at 3:49 in the video.
What does this mean for consumers?
In basic terms, if a flight is cancelled or significantly delayed, the airlines will still make every effort to get you on alternate flight(s) to get you to your destination. They have the ability to reschedule your flight, issue you travel credits or compensation. If a consumer is not offered an alternative method of transportation, or rejects it, the consumer is entitled to a refund.
How can I stay updated on developments?
Review the Airline Customer Service Dashboard at flightrights.gov.
What is considered a cancellation?
The ruling states the definition of a cancelled flight as, “a flight that was published in a carrier’s Computer Reservation System (CRS) at the time of the ticket sale but not operated by the carrier.” Basically, if a flight didn’t happen due to issues related to the airline. This does not include cancellations due to weather.
What is mean by a significant changes or delays?
According to the ruling documentation, “significant changes” are defined as:
- a three hour or longer delay in scheduled departure time for domestic itineraries, or a six hour or longer delay for international itineraries;
- when a passenger is scheduled to depart from a different origination airport or arrive at a different destination airport;
- the passenger is scheduled to travel on an itinerary with more connection points than that of the original itinerary;
- the passenger is downgraded to a lower class of service;
- the passenger with a disability is scheduled to travel through one or more connecting airports that differ from the original itinerary; or
- the passenger with a disability is scheduled to travel on a substitute aircraft that results in one or more accessibility features needed by the passenger being unavailable.
Again, I feel obligated to mention that this won’t be implemented until the fall, so if changes occur between now and implementation, you may not be entitled to a refund.
Who should I contact for a refund and how will it be issued?
Consumers will likely work with the airline companies to file for and obtain a refund. Airlines are working through their implementation processes so there are still a lot of unanswered specifics. I speculate, given my time in management consulting, the consumer will be provided information regarding the refund at the airport or communication from the airline, with instructions on claiming a refund. However, this process is still to be determined.
Most travel agencies, including mine, do not hold any of your funds. We purchase tickets on your behalf by means of credit card authorizations with the supplier. That said, consumers who purchase airline tickets through agencies working with the authorization method would need to contact the airline directly.
While the process of airline refunds are still being worked through, this will be mandated by the government and airlines will be held accountable if they don’t comply. So, this means a large win to those who experience disruption during their trips.
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**Disclaimer:**
The content provided in this blog post is for informational purposes only and should not be construed as legal advice. Our company does not offer legal counsel, and any information shared here is not a substitute for professional legal guidance. It is recommended to consult with a qualified legal professional for specific legal advice tailored to your individual circumstances. Questions about the ruling should be sent directly to the U.S. Department of Transportation via the link provided. The views expressed in this article are solely those of the author and do not represent the opinions of our company.