In an enforcement notice published Friday, the United States Department of Transportation (DOT) warned airlines that “passengers should be refunded promptly when their scheduled flights are cancelled or significantly delayed.”
The warning comes amid growing concern from consumers who are increasingly unable to get refunds for flights or trips impacted by the COVID-19 pandemic, and from the travel agency community who have been bearing the growing weight of the refunds in the form of debit memos and chargebacks.
“Airlines have long provided such refunds, including during periods when air travel has been disrupted on a large scale, such as the aftermath of the September 11, 2001 attacks, Hurricane Katrina, and presidentially declared natural disasters,” the DOT’s notice reads.
“Although the COVID-19 public health emergency has had an unprecedented impact on air travel, the airlines’ obligation to refund passengers for cancelled or significantly delayed flights remains unchanged.”
The International Air Transport Association (IATA), the major association representing the world’s airlines, has been pushing governments to allow the airlines to do away with the current refund requirements and make it easier for the airlines to handle the record number of refunds that are being requested by consumers worldwide.
However, the letter from the DOT on Friday seemingly denies IATA’s request. The DOT wrote that it is increasingly receiving complaints from consumers who cannot get refunds or are having their refunds delayed and that airlines have a longstanding obligation to give a refund “when the carrier cancels the passenger’s flight or makes a significant change in the flight schedule and the passenger chooses not to accept the alternative offered by the carrier.”
“In many of these cases, the passengers stated that the carrier informed them that they would receive vouchers or credits for future travel. But many airlines are dramatically reducing their travel schedules in the wake of the COVID-19 public health emergency. As a result, passengers are left with cancelled or significantly delayed flights and vouchers and credits for future travel that are not readily usable.”
ASTA calls for ‘Increased Airline Flexibility’ for traveling public and agency community
Also on Friday, ASTA called for an overhaul of airline refund and cancellation rules, which the association says is causing pain amongst both travel advisors, their clients and the traveling public.
The message was cosigned by a number of travel agency groups including: ASTA Corporate Advisory Council, BCD, Chrstopherson Andavo Travel, Cruise Planners, Ensemble, GIFTED, Hickory Global, KHM, LTA, MAST, NEST, Nexion, OASIS, Palm Coast Travel, Signature, TerraMar Travel, Travel Experts, Travel Leaders, TPI, TRAVELSAVERS, Travel Quest Network, Virtuoso, Western Association of Travel Agencies, and Your Travel Center/Montecito Village Travel.
In the messave, ASTA writes that the exchange and refund rules, which existed before the COVID-19 pandemic, are “now causing an unprecedented degree of frustration among travelers and travel advisors alike,” ASTA wrote in the letter. Not only is it causing frustration, but the effects that come with it, namely the credit card chargebacks, are further negatively impacting the bottom line for travel advisors who are also already dealing with their own slate of client cancellations.
ASTA and the letters’ co-signers said they emphasize with the plight of the airlines, who have gone from bumping passengers from full aircrafts to flying planes that are virtually empty. “What was only a month or two ago a lucrative business, has now almost come to a standstill with aircraft parked and idol through no fault of any carrier,” the letter says.
However, travelers being unable to quickly secure full refunds for airline tickets, that are no longer needed if a passenger’s cruise or tour or business meeting was cancelled, will not help consumer confidence in the industry.
“For airlines, in particular, to restore consumer trust and brand loyalty when the world opens up to travel again - as it will soon - a complete review of how these policies morphed into a cumbersome and overly burdensome ordeal must occur.”
That review, the letter says, includes revising rules to honor refund requests and to process them through a GDS or ARC and “ensuring credit card companies are aligned with this effort.”
Overall, ASTA and others are calling on the airlines to do the following:
- Relax fare rules to accommodate refunds for all flights through 2020.
- Stop issuing debit memo on credit card chargebacks.
- Push consumers who booked through an advisor to contact the advisor to make the changes.
- Make all tickets fully refundable and not just creditable.
- Allow advisors to process through their GDS and ARC.
- Protect commissions on refunded, exchanged, or rebooked tickets.
- Extend the flight credits for a minimum of two years from departure dates.
- Extend the rebooked window for all tickets booked after March 1 to at least one year after booking date.
- Cancel or refund all ancillary fees for flights booked in 2020.