Discover the latest consumer protections for airline passengers, including automatic refunds and fee transparency. Learn how these changes impact your travel.
The airline industry has faced significant challenges recently, particularly following the massive CrowdStrike IT outage that disrupted flights globally.
As a result, the U.S. Department of Transportation has introduced new consumer protections to alleviate the burden on airline passengers.
These changes aim to provide automatic refunds for cancellations and delays, as well as increased transparency regarding fees.
FAQs
Q1: What should I do if my flight is canceled or significantly delayed?
A1: You are entitled to an automatic refund for canceled or significantly delayed flights. Ensure you contact the airline for rebooking options if you prefer to continue your journey.
Q2: Are airlines required to disclose all fees upfront?
A2: Yes, airlines must provide a detailed explanation of all ancillary fees before a ticket purchase, ensuring transparency for passengers.
Q3: When will these new protections take effect?
A3: The implementation of these protections will occur over the next year, with some rules potentially facing delays due to legal challenges.
Impact Of Crowdstrike IT Outage And Airline Passenger Consumer Protections
Banks, hospitals, retailers, and airlines are still dealing with the fallout from the massive CrowdStrike IT outage in July. The tech meltdown impacted businesses across the globe, and airlines were hit particularly hard.
This was not good news for the airline industry, which just last year had the highest number of flight delays ever recorded.1
The U.S. Department of Transportation determined that the delays and cancellations resulting from the CrowdStrike outage were “controllable,” or caused by the airline.
As a result, most airlines were obligated to provide some sort of compensation and assistance to stranded travelers.2
Fortunately, there could be much-needed relief for airline passengers on the horizon, thanks to a new federal law and rules issued by the U.S. Department of Transportation.
Hassle-Free Refunds for Airline Passengers
In the past, airline passengers were forced to figure out how to obtain a refund by researching an airline’s website or waiting for hours on the phone with an airline’s customer service department.
Airline passengers will be entitled to an automatic refund for:
- Cancelled or significantly delayed flights regardless of the reason
Departure or arrival times delayed by three hours or more for domestic flights and by six hours or more for international flights
- Significantly delayed baggage return
Entitled to a refund of their checked bag fee if it is not delivered within 12 hours of their domestic flight arriving at the gate, or 15-30 hours of their international flight arriving at the gate, depending on the length of the flight
- Extra services that were paid for but not provided
Wi-Fi, seat selection, or inflight entertainment
Airlines must issue refunds of the full amount of the ticket purchased within seven business days of refunds becoming due for credit card purchases and 20 days for other payment methods.
Passengers who accept a ticket for a significantly delayed flight or are rebooked on a different flight to their destination will not receive refunds
The refunds must be in the form of cash or whatever original payment method was used to make the purchase (e.g., credit card or airline miles).
Finally, airlines are not allowed to substitute other forms of compensation (e.g., vouchers or travel credits) unless a passenger affirmatively chooses to accept an alternate form of compensation.
Consumer Protections Against Surprise Airline Fees
Many airlines advertise cheap “teaser” fares that don’t take into account additional fees — all of which can significantly increase the cost of a ticket.
Airlines will be required to disclose various ancillary fees up front, such as charges for checked bags, carry-on bags, and changing or cancelling a reservation. They must also provide a detailed explanation of each fee before a ticket can be purchased.
The rule on surprise fee disclosures was temporarily blocked by a U.S. Appeals Court last week
In addition, under a proposed rule airlines will be prohibited from charging families an extra fee to guarantee a child will sit next to a parent or adult travel companion.
When Are These Consumer Protections Scheduled To Take Effect?
These consumer protections are scheduled to have different implementation periods over the next year.
The new consumer protections introduced by the U.S. Department of Transportation represent a significant step forward for airline passengers. By ensuring automatic refunds and transparency in fees, these changes aim to reduce the stress and financial burden on travelers.
Contact your tax and financial advisors to determine the best moves for your situation.
1-2) U.S. Department of Transportation, 2024