US airlines will owe you money for delays under new proposal

But there is potential relief on the horizon: The Biden administration is working hard on a proposed rule that would require US airlines to offer compensation to passengers for cancellations or controllable delays of three hours or more. It can be issued as early as January 2025 and is expected to be a game-changer for US passengers and the US aviation industry.

“This is not radical — we’ve been late to the game on this as a country,” said Michael Negron, special assistant to the president for economic policy at the White House, speaking at an invitation-only meeting in Washington on Sept. 10.

This proposed compensation scheme would mean that US airlines would have to pay a fixed amount of cash payment to each passenger on a disrupted flight, in addition to compensation for meals and lodging. Exact details and amounts are still being worked out.

A similar scheme has existed in the European Union for the past 20 years, which is applicable to US airlines when operating internationally. EU rules require airlines to compensate travelers between $275 and $660 for controllable cancellations and extended delays, depending on the flight distance.

“When an airline cancels a flight due to mechanical or personnel issues, passengers should be compensated for their trouble,” said Sen. Edward Markey (D-Mass.), who sits on the U.S. Senate Commerce Committee. Science and Transport.

Delay compensation rules are already in place in other countries such as Canada, India, Saudi Arabia, Turkey, Brazil and China, and Australia is set to pass one this year, says Tomasz Pawliszyn, chief executive at European consumer rights group AirHelp. who advised the US government. If airlines chose to pass the cost of these potential passenger refunds onto the ticket price, it would amount to less than €1 or $1 per ticket, he adds.

Passenger complaints against US airlines have quadrupled in the past four years, hitting a record in 2023 with just over 61,000 filed. “Complaints in 2023 are up 29%, even though ridership is up just 11% – this reflects how ticked off people are when they feel things aren’t going well,” says Teresa Murray, director of consumer watchdogs at US Public Interest Research. Group.

Of these complaints, 35% related to flight issues, 20% related to refunds and 16% related to baggage. Although, she adds, overall cancellations have improved so far this year, as have on-time rates.

Major US airlines have different rules for how they handle delays. All 10 will rebook you on the same airline when your flight is interrupted or cancelled, and provide you with meals. Nine out of 10 will offer you hotels and ground transport, while only six will rebook you on another airline, and only three out of 10 will give you a voucher. Currently, no one pays cash for any kind of cancellation or delay.

The Biden administration’s ultimate goal is to incentivize airlines to provide better service. In Europe, flights have a higher on-time rate, which Negron says indicates there may be a strong correlation with European airlines being required to compensate travelers. Last year, only 1% to 2% of all travelers were compensated due to disruptions, AirHelp data confirms.

“Where there’s a clear standard, it’s good for the industry and it’s good for consumers because everyone understands what’s required,” says Negron. “This information can lead to improved services.”

This latest discussion about air travel delay compensation comes on the heels of a series of regulations from the Biden Administration that were aimed at protecting travelers and holding American airlines accountable. There is the clarification of passenger rights on FlightRights.gov, a proposed rule to improve air access for passengers with disabilities, the recent rule requiring airlines to provide automatic and prompt refunds to passengers in the original form of payment, stated in the FAA Reauthorization Act. , and proposed regulation to ban fees for family seats.

“It’s all part of trying to give passengers more assurance that you’re going to be OK,” says Negron, who adds that he’s working as fast as he can to iron out certain details. “We can’t make up for the fact that you had to spend nine hours away from your family stuck in an airport or hotel, but we can make sure airlines are held accountable when they could have prevented it.”