US Department of Transportation Warns Airlines: Customers Are Entitled To Refunds

As we said before, when a flight is canceled by the airline (no matter the reason or situation), you should get a full refund in cash, not a travel credit or an airline voucher. It’s common sense (and an explicit regulation in many jurisdictions). Understandably, airlines are trying to get out of this given their situation. You’d think this is the kind of situation where government agencies would step in to protect consumers. And that’s actually exactly what happened yesterday… in the US!

What a stark contrast with the Canadian Transportation Agency’s statement from last week. You could literally not find two positions further apart.

The US Department of Transportation (US DOT) is actually enforcing the law and protecting consumers… what a novel concept, right?

And it applies to all flights to and from the US, so this is great news even for those who booked on Canadian (or international) carriers for US destinations (or with US transits).

 

Brief Reminder About The Situation

Airlines are in trouble, but plenty of travelers are now in a precarious financial situation too because of this crisis. They understandably want the money from their canceled flight back, as they are entitled to (which is obviously true only if the airline cancels the flight, not if you cancel it—that’s one of the 4 reasons why you should wait before canceling future trips).

Amid the questionable practices by airlines (who weren’t making it easy by refusing to give out anything other than travel credits), many Canadians wanted the government to step in and enforce passenger’s right to get a refund (but some travel agent associations did not: you would think they would defend their customers, travelers, but they formally took the airlines’ side instead unfortunately).

So last week the Canadian Transportation Agency issued a statement that contradicts its own past rulings (and likely Canadian contractual laws) and isn’t binding in any way… but legitimizes travel credits for now (to be continued).

The US on the other hand has unambiguous regulation stating that travelers are entitled to refunds, which is much more explicit than how Canadian travelers are protected. Despite this, many airlines still refused to abide by the rules.

(Later today, I’ll share the post I promised about my own experience getting a full refund from Delta in March.)

Therefore, like its Canadian counterpart, the US Department of Transportation decided to issue a statement yesterday. But the fact they both issued a statement is really the only similarity in these two situations.

 

US DOT “Enforcement Notice”

Instead of a vague unsigned statement that allows airlines to deny refunds like the CTA put out, the US DOT not only reaffirmed passengers’ right to refunds, they did so in a very strongly-worded message.

Even the title of their declaration, an “enforcement notice”, is pretty forceful.

Here is the main excerpt (emphasis is mine):

“This notice reminds the traveling public and U.S. and foreign carriers that passengers should be refunded promptly when their scheduled flights are cancelled or significantly delayed. Although the COVID-19 public health emergency has had an unprecedented impact on air travel, the airlines’ obligation to refund passengers for cancelled or significantly delayed flights remains unchanged.

It’s crazy, I know: who would’ve thought that regulations that say a refund is mandatory no matter the situation should apply no matter the situation?

Pardon my sarcasm.

In all cases, it’s also worth noting that not only is the US DOT putting its foot down and telling airlines to stop denying refunds, they even added that passengers should be refunded “promptly”.

This was another of the airlines’ tactics: some wouldn’t deny the refund outright. But they would significantly delay paying it out. But now, it couldn’t be clearer that that isn’t allowed either.

Finally, exactly as I told you earlier this week, the US DOT reiterates clearly that American laws apply to foreign carriers too, obviously. I had written it in clear terms: the CTA’s “non-decision” cannot override US regulation for US flights.

So if Air Canada, WestJet, Air Transat, Sunwing, Porter, or Swoop are giving you a hard time and not giving you a full refund for US flights by citing the CTA’s non-decision statement, inform them of this US Department of Transportation statement that reaffirms that the original US DOT regulation still applies during the coronavirus crisis.

If they don’t comply, file an official complaint with the US DOT and try a chargeback with your credit card by again citing the US declaration and regulation above (and I just updated our post about what to do to try to get a refund if your flight is canceled with this new info).

Now, at least Canadian travelers who were flying to the US (or the EU) won’t be forced to be in the business of providing interest-free loans to mega-corporations worth billions of dollars, which is more than we can say for all those who chose any other destination with Canadian airlines.

Speaking of billions of dollars, US airlines got a huge $50 billion bailout, which definitely helps their financial situation for now, and keeps them safe from bankruptcy.

That’s the whole argument why Canadian travelers should apparently be forced to provide financing to airlines by taking vouchers instead of refunds: because the airlines will fail if they have to give refunds.

But does anyone really think the Trudeau government will let all airlines fail? Or even that just keeping travelers’ money will be enough to save airlines?

Airlines are in a dire situation and I completely sympathize as an aviation geek and someone who loves everything about this industry (as I explained), but they will already likely be getting a ton of taxpayer money—which is a whole other topic/debate in and of itself.

So since they’ll be getting taxpayer money, wouldn’t it make sense to not let them also keep the money that travelers are entitled to get back?

A lot of Canadians need that money now more than ever, based on recent government data about new unemployment, among others.

And our Facebook poll sure isn’t scientific, but it seems to reflect the hundreds (thousands?) of messages we’ve gotten in the past weeks: those who want to help airlines by letting them keep their money should obviously be free to choose that, but those who want their money back should be able to get it, as they are supposed to be entitled to.

Now at least for US flights, it’s absolutely 100% clear that refunds are not optional thanks to the clarity provided by the US Department of Transportation.

The Canadian Transportation Agency should take notes.

 

Want more travel news and tips for Canadian travelers?

 

 

Summary

The US Department of Transportation issued a stern warning to airlines trying to illegally deny refunds for canceled flights. This is quite the contrast with the Canadian Transportation Agency’s non-decision statement that legitimizes that practice for Canadian carriers. But remember that US regulations apply to all flights to and from the US, so get your refund, no matter your airline! And don’t miss our upcoming article about why refunds are so much better than credits for you.

 

Did you manage to get a refund? Or just a credit? Tell us in the comments below!

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Andrew D'Amours

Andrew is the co-founder of Flytrippers. He is passionate about traveling the world but also, as a former management consultant, about the travel industry itself. He shares his experiences to help you save money on travel. As a very cost-conscious traveler, he loves finding deals and getting free travel thanks to travel rewards points... to help him visit every country in the world (current count: 59/193 Countries, 46/50 US States & 9/10 Canadian Provinces).

This Post Has 10 Comments

  1. Kaity

    Hi! It was a vacation package via air canada to Vegas!! So it is American. Gonna stay at Wynn

    1. Andrew D'Amours

      Oh, in that case well definitely you are entitled to a refund for the flight portion at least! It’ll just be a hassle to get AC to give it, but it’s very clearly mandatory. Now the hotel portion: in theory it’s even easier to get hotels refunded than flights normally, but since the US DOT is not as explicit, I would guess AC will give you a hard time. But it’s worth a try for sure!

  2. Kelly MacKay

    My wife and I had 2 flights cancelled from Phoenix to Calgary. We paid for them with BMO travel reward points. BMO Travel has given us credits for both flights but they have to be used by September 2020 and March 2021. I haven’t contacted them since this new US ruling you mentioned. 1 flight was with Westjet returning on April 9 from AZA and was canceled by WJ the other was through Air Canada on their partner airline United Airlines returning on March 30 from PHX.

    1. Kelly MacKay

      Thanks Andrew. The flights were booked through BMO Rewards Travel effectively makings them the travel agent so I’m assuming I need to get the refund from them and they will get reimbursed from the airline?

      1. Andrew D'Amours

        You can start there yes, but you might need to follow the steps with the US DOT. Good luck and thanks for following us!

  3. Nathalie

    Hi. I tried getting a refund from westjet for my flight from barcelona that they cancelled and was denied. I did everything you mention in your post on how to get refund and they told me To contact the CTA… not sure what To do any more and doubt a formal complaint Will do anything. Thanks

    1. Andrew D'Amours

      Hi, you should try again explaining that the CTA rules can’t supersed EU regulations since your flight was from the EU, maybe WestJet will be more likely to follow the law, although that’s far from certain. We’ve posted an updated article with step by step instructions here: https://flytrippers.com/heres-what-you-can-do-to-try-to-get-a-refund/
      You need to send them an email of the official complaint form, and 6 weeks after sending it to the airline, you send it to the Spanish board (we’ll cover that last part in a soon-to-be-published post).
      Hope this helps, good luck and thanks for following us 🙂

  4. Kaity

    What about vacation packagers???

    1. Andrew D'Amours

      Hello, I’ve never purchased one so I am not at all as knowledgeable about that. But I don’t think there are any packages with US flights, so the Canadian rules (or lack thereof for now) would apply and you can only get a credit, at least until the CTA changes its mind.
      Hope this helps, good luck and thanks for following us 🙂

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