Feds order airlines to refund tickets for all corona-affected flights

The U.S. Department of Transportation has issued an enforcement notice to all commercial airlines, ordering them to promptly refund the complete cost of all tickets sold to passengers whose flights have either been canceled or significantly delayed due to the COVID-19 public health emergency.

“The department is receiving an increasing number of complaints and inquiries from ticketed passengers, including many with non-refundable tickets, who describe having been denied refunds for flights that were canceled or significantly delayed,” states a U.S. DOT news release issued April 3. “In many of these cases, the passengers stated that the carrier informed them that they would receive vouchers or credits for future travel.”

“This notice to remind the traveling public, and U.S. and foreign carriers, operating at least one aircraft having a seating capacity of 30 or more seats, that passengers should be refunded promptly when their scheduled flights are canceled or significantly delayed,” the notice continues.

“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. Although the COVID-19 public health emergency has had an unprecedented impact on air travel, the airlines’ obligation to refund passengers for canceled or significantly delayed flights remains unchanged.”

The DOT said that, for the time being, it will refrain from exercising its prosecutorial authority over the airlines to provide them with an opportunity to come into compliance with its directive. However, the Airline Enforcement Office will continue to monitor airlines’ refund practices and will take enforcement action as it deems necessary.

The DOT’s directive requires airlines to contact affected passengers in a timely manner, and to offer them the option of either accepting a voucher for a later flight or to receive a complete refund, even if their tickets were originally purchased on a non-refundable basis.

“The focus is not on whether the flight disruptions are within or outside the carrier’s control, but rather on the fact that the cancellation is through no fault of the passenger,” the DOT’s notice states. “Accordingly, the department continues to view any contract of carriage provision or airline policy that purports to deny refunds to passengers when the carrier cancels a flight, makes a significant schedule change or significantly delays a flight to be a violation of the carriers’ obligation that could subject the carrier to an enforcement action.”

The DOT’s directive comes in light of a substantial aid package Congress approved for U.S. air carriers on March 26.

As the number of passengers plummets due to the COVID-19 outbreaks, airlines have canceled hundreds of flights a day. The Transportation Security Administration reports that it screened only 122,000 passengers through all U.S. airport security checkpoints on Sunday, April 5, down 95% from the 2.46 million passengers it screened at the same time a year ago.

To stave off the potential of an industry-wide collapse of U.S. airlines, Congress authorized a $50 billion relief package, half of it in the form of grants to keep employees such as pilots, attendants, mechanics and gate agents on the payroll. The remaining $25 billion will come as low-interest loans.

To be eligible, airlines must agree to maintain their workforce at current levels and to continue flights to every U.S. city they served at the beginning of March before the COVID-19 virus outbreak began keeping people home in large numbers.

Still, many analysts predict it will take several years before the U.S. airline industry returns to pre-COVID-19 levels and that some airlines may not survive at all.

“We think it will be 2022 or 2023 at the earliest before we could see anything like a normal year,” Helane Becker, an airline industry analyst with Cowen investment bank told National Public Radio. “And the industry’s going to be a whole lot smaller.”

On Sunday, Montana senator Steve Daines said it is “commonsense and important” for Montanans to get their money back if their flights have been canceled due to the coronavirus outbreak.

“Montanans don’t need any more financial stress as we work together to overcome this difficult time in our nation’s history,” Daines said through a news release.

The U.S. Department of Transportation’s notice can be found on the Department’s website at https://www.transportation.gov/.