DOT proposes new airline refund rules amid travel chaos


The Department of Transportation has proposed new rules to better protect travelers in case their flight is delayed, canceled or otherwise significantly changed — a response to the “flood of air travel service complaints” the department has received since the coronavirus pandemic began, it said in a news release.

By defining when a flight can be considered canceled or significantly changed, the proposal aims to plug a gap in the Transportation Department’s ability to prevent what it considers unfair practices in the transportation industry and to force carriers to refund consumers it says are victims of these practices.

If enacted, it would be “the largest expansion of travelers’ rights in decades,” Scott Keyes, founder of a website that helps travelers find cheap flightstold The Washington Post.

So, what does it mean for you?

What are the proposed rules?

Under the proposal, which is subject to a 90-day public consultation period, airlines and ticket agents would have to refund consumers when they “significantly” change their flights.

This would apply to domestic flights that are delayed by three or more hours, or international flights that are delayed by six or more hours. It would also apply if the departure or arrival airport is changed, if extra connections are added or if the class of service or type of plane is changed, for instance, downgrading someone from business to economy class or putting them in an aircraft with fewer amenities than expected.

If a carrier published a flight in its online reservation system when the ticket was sold but ultimately did not operate the flight for any reason, it would be considered canceled under the new rules.

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“When Americans buy an airline ticket, they should get to their destination safely, reliably, and affordably,” Transportation Secretary Pete Buttigieg said in the news release. “This new proposed rule would protect the rights of travelers and help ensure they get the timely refunds they deserve from the airlines.”

The new rules would also require that airlines issue credits with no expiration date to ticket-holders who decide not to travel because they are sick or because of government travel restrictions including, for example, the imposition of a quarantine requirement for arriving passengers. In the case of airlines that receive future government bailouts, the rule would require them to issue refunds rather than credits.

But there are restrictions. For instance, if someone books a flight but new public health restrictions are later imposed that would render the trip “meaningless,” that person would be entitled to a nonexpiring voucher or credit. But if someone fails to check what is needed to travel, such as PCR tests, and is unable to go, they will not be eligible.

How are they different from the current rules?

Under current rules, travelers to and from the United States are already entitled to a refund if their flight is canceled or significantly delayed and they choose not to take another option, or if they are involuntarily downgraded to a lower-tier service than what they paid for.

But since the Transportation Department does not define “significant delay,” in practice, whether travelers were entitled to a refund depended on many factors “including the length of the delay, the length of the flight,” and individual circumstances, it said. If a complaint is filed, the case-by-case process for the department to determine if a refund is needed takes a long time, it warns consumers.

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The lack of clarity around what constitutes a canceled or significantly delayed flight has led to “inconsistency among carriers on when passengers are entitled to refunds,” the Transportation Department said in the news release. The inconsistency has benefited carriers, who could define significant delays expansively so as to avoid having to refund travelers, Keyes argues. “Two hours might be a big deal for me, but it might mean nothing to the airlines,” he said.

Meanwhile, passengers who choose not to travel because they are sick or because they are particularly vulnerable to getting sick are generally not protected under current rules. Because of this, people who are sick and could infect others, or those who are at particular risk of getting seriously ill, may choose to travel anyway so as not to lose the money they spent on their ticket. “These types of actions by consumers are not in the public interest,” the department said.

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When would this go into effect?

The proposed rule from the Transportation Department has a while to go before it could be enacted. After the period of public consultation of 90 days ends, the department will review the comments and decide whether to continue with the proposed rule as is, make changes to it or withdraw it.

Anyone can submit a comment, including businesses that would be affected by the rule. Airlines will probably “try to improve [the proposed rules] from industry standard perspective,” Keyes says. If the rules are enacted, businesses can apply for an exemption, which the department will only consider if it finds “unique circumstances not considered during rulemaking.”

What are my rights if my flight is delayed now?

Travelers have reported a jump in travel woes this summer — from canceled or delayed flights to lost luggage and strikes — as many countries have eased or eliminated all pandemic-related restrictions, leading to more demand, and airports and airlines have been unable to cope.

Close to 550,000 flights have been delayed this year so far in the United States, according to Transportation Department data, more than twice as many such flights in all of 2021. More than 88,000 flights were canceled, or about 3.2 percent of all flights, compared to less than 1.6 percent of flights last year.

If your flight is one of them, the current rules still apply. For a flight arriving or departing from the United States, you are entitled to a refund if your flight is canceled or significantly delayed and you choose not to take another option. It also applies if you are involuntarily downgraded to a lower-tier service than what you paid for.

How to get refunds from an airline carrier if your flight is canceled

You are also entitled to compensation if you have been denied boarding because your flight was overbooked and you did not volunteer to give up your seat. Airlines are allowed to overbook flights, and there is no minimum they must offer when asking travelers if anyone is willing to take a later flight. Passengers have reported that airlines have been offering thousands of dollars for people to volunteer to be bumped from their flights.

If you are involuntarily bumped, airlines should give you a form detailing your rights for compensation, which is often tied to when you get to your final destination. Keep in mind, most airlines require you to be checked in or at the gate by a certain time to be eligible for compensation beyond the cost of the flight.

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