William McGee, aviation adviser at Consumer Reports, sounds miffed. He also sounds steamed and exasperated. Pretty much any synonym for the word angry would do his feelings justice.
Since COVID-19 came along and uprooted people’s lives and their travel plans, McGee said airlines have been far too stingy about issuing refunds. Airlines have been trying to give customers vouchers rather than refunds for flights that have been canceled, rescheduled, no longer wanted, or are simply ill-advised at this point.
“This is just absurd,” McGee said. “We are in a national emergency and a global pandemic. Everyone is telling you to stay home and not travel, and then you’re penalized for not showing up at the airport? Our position is that there should be no difference between refundable and nonrefundable flights during a national emergency.”
To stop hemorrhaging profits and to try enticing people to fly again, airlines have been waiving change fees on booking, in some cases for up to a year, to give fliers more flexibility and alleviate worries. The move is unprecedented for airlines, which charged hundreds of dollars to make changes before the pandemic. But many who already purchased tickets found that obtaining an actual cash refund from an airline was like getting blood from a stone.
“Let’s be very clear,” said McGee. “Consumers are at the hands of airlines in the United States. “Unlike Europe or Canada, the government regulations here are not so strong in protecting passengers. Every time you book a flight and swipe your card, you’re agreeing to a 90-page contract that was written by and for the airlines.”
Since complaints began rising against airlines at the start of the pandemic, the Department of Transportation, which oversees the aviation industry, warned carriers not to be so parsimonious with refunds. According to the DOT, during an average March and April, the agency fields about 1,500 complaints. This year that number was 25,000 complaints.
But the wording of the Aviation Enforcement Act is so murky that’s it’s difficult to pin down the exact rules for refunds. A statement meant to clarify passenger rights issued last month was more confusing than helpful and leaned heavily in favor of airlines calling the shots of what merits a refund and what doesn’t.
In April, Democratic Senators Ed Markey and Elizabeth Warren of Massachusetts, Richard Blumenthal of Connecticut, and Kamala Harris of California released findings from an investigation into refund policies of the airline industry during the pandemic and determined that airlines were sitting on about $10 million that was owed back to consumers.
Since the report, the senators have signed on to a bill that would require major airlines and third-party ticket sellers to offer full cash refunds for all canceled tickets, regardless of whether the airline canceled the flight, or the passenger canceled the individual ticket.
“Americans need cash in their pockets to pay for food, housing, and prescriptions, not temporary credits toward future travel,” said Markey in the bill announcement. “In light of this pressing need, and an unprecedented multi-billion dollar bailout, it’s absolutely unconscionable that the airlines won’t give consumers their money back.”
In an e-mail, Katherine Estep, communications director for the industry group Airlines for America, disputed those claims, saying “US airlines comply with all federal laws and regulations. Accordingly, refunds are issued to passengers when flights are canceled by the airline.”
Airlines are required to refund customers if a flight is canceled or “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,” according to the DOT. For most airlines a “significant change” is more than two hours. Although at one point United Airlines attempted to make a “significant change” more than 25 hours.
But that wasn’t the experience of Stephen Ford of Shrewsbury, who e-mailed me to complain that he was still waiting for a refund for a flight that was canceled in April. The refund was hard-earned after he spent hours on the phone with multiple airline representatives. But the credit for the canceled United flight has yet to appear on his credit card statement. It’s the same story for Paula Rodriguez of Chelsea, who also e-mailed me, hoping I could help her retrieve the $530 her mother spent for a flight to a family reunion that has been canceled.
“My mom is 78,” Rodriguez said. “She has no interest in a travel credit. She just wants her money back.”
Many consumers are playing the waiting game. If a flight is canceled, they automatically will get their refund. But for those who bought their ticket well in advance, which describes many leisure travelers, getting a refund shouldn’t involve playing games. I have heard some success stories from readers in obtaining their refund, but just as many tales of frustration.
According to Christian Nielsen, a board member on the Association of Passenger Rights Advocates and chief legal officer of AirHelp, the current situation with airlines pushing vouchers and consumers looking for refunds is best described as a dog chasing its tail. Americans, who are out of work in numbers not seen since the Great Depression, want cash. The airlines, who have lost billions and stand to lose billions more, want to hang on to that cash and offer vouchers for future travel instead.
“When the crisis happened and they suddenly had to ground all the planes, the only cash on hand was from the tickets that had already been purchased,” Nielsen said. “If they started making all of those refunds before any government bailout money came, you’d certainly see airlines going out of business.”
He said an ideal outcome from this situation would be for lawmakers to start looking at protections for passengers, because he doesn’t want to see a repeat of the situation when, or if, a second wave of the virus strikes.
“We need people to feel safe not only from a health perception, but from a rights perception as well,” he said.
Airlines are expected to post a loss of $84.3 billion in 2020, according to the International Air Transport Association. This week the association, which represents airlines around the world, called on governments to continue to provide financial support and to waive airport and air traffic control charges. In the United States, Congress passed the CARES Act, which allotted $50 billion for airlines in the form of grants and loans.
In general, airlines have been getting better about issuing refunds, says Scott Keyes, founder of Scott’s Cheap Flights. Although those results vary from airline to airline, he said some foreign airlines, such as Air Canada and TAP, have been particularly bad about issuing refunds.
“I really wouldn’t say that they’re good about it, they’re just following the law more” Keyes said. “It would be like someone congratulating me for walking out of a store without shoplifting.”
McGee of Consumer Reports said he isn’t seeing an improvement and called out Secretary of Transportation Elaine Chao and the DOT for not clarifying guidelines or closing loopholes in the language surrounding a passenger’s ability to receive a refund. He also thinks the DOT should be more proactive in helping consumers, particularly since the government handed the industry $50 billion in April.
“To be very clear we have spoken to the consumer division of the Department of Transportation. More than once,” he said. “We have asked ‘Are you going to be introducing additional language to close these loopholes?’ and the answer has consistently been ‘No.’ It’s basically the Wild West. Consumers are at the mercy of the airlines.”
A representative from the DOT strongly disagreed with McGee, stating that the agency has been actively pursuing airline refunds for customers and that Chao has called upon airlines to be more responsive to customers during the pandemic. He pointed to an opinion piece from Chao that ran in USA Today last month in which the Secretary wrote “The department is closely monitoring airline practices regarding refunds, especially for reasons that are beyond the control of passengers.”
“The Department has not been inactive on passenger refunds,” said a department spokesperson. “And our office handling consumer affairs is absolutely not the ‘wild west.' The DOT has a dedicated staff of career civil servants... reviewing each and every consumer complaint carefully to determine whether or not airline actions violate DOT regulations.”
McGee’s advice is that travelers experiencing difficulties with airlines should ask the airline for a full cash refund, gather all documentation before getting on the phone, file a claim with the DOT, and dispute the charge with the credit card company. Persistence is key. You may have to call back several times until you get a representative who will listen to you and understand your problem.
“It’s kind of mind-boggling,” McGee said. “Airlines don’t act like other corporations. In other words, one of the most basic tenets of contract law is that I give you money for goods and services, or a product, and then you give it to me. If you don’t give it to me, I get my money back. I can’t think of another industry outside of travel where that doesn’t happen.”