US proposes to compensate passengers for flight delays

Tuesday, May 9, 2023

Ahead of what promises to be a busy summer for the travel industry, the US Department of Transportation is proposing new rules that would require airlines to compensate passengers for cancellations and disruptions caused by the airlines.

Airlines for now are required to issue refunds to passengers if flights are cancelled or significantly delayed due to factors within an airline’s control, including staffing shortages and maintenance issues.

But the proposed rules, if approved, would require airlines to offer cash compensation and accommodation vouchers in addition to those refunds.

The rules would also call for timely customer service during and after periods of widespread flight irregularities.

Joe Biden and his transportation secretary, Pete Buttigieg, were planning to announce the proposal at the White House on Monday.

When an airline causes a flight cancellation or delay, passengers should not foot the bill, Buttigieg said in a statement.

This rule would, for the first time in US history, propose to require airlines to compensate passengers and cover expenses such as meals, hotels and rebooking in cases where the airline has caused a cancellation or a significant delay.

The rules build on others that the transportation department proposed last year which would require airlines to inform passengers that they have a right to a refund if their flight is cancelled and to be transparent about fee information as customers buy tickets.

The proposals would not be immediately implemented as they went through a months-long rules-making process.

The transportation department last fall also launched an airline customer service dashboard that outlines what the 10 major US airlines offer passengers in the case of controllable cancellations and delays.

The transportation department said that all 10 airlines now offer meal vouchers and free rebooking on the same airline, and nine offer hotel accommodations for such cancellations and delays.

After the Covid-19 pandemic largely shut it down for most of 2020, air travel has roared back in recent years, with US airlines carrying 853 million passengers in 2022, down from the all-time high of 928 million passengers in 2019 but up from 388 million passengers in 2020.

US airlines were given $50bn in stimulus money during the pandemic, but airlines still experienced issues as travellers started to fly again.

The airline industry has said that staffing shortages were behind many of the problems which have caused travel disruptions.

In 2022, up to 2.71% of flights were cancelled – the highest rate in a decade. December saw the highest cancellation rate, largely due to the meltdown of Southwest Airlines.

Southwest had to cancel 17,000 flights – about 15% of the operation’s flights for the month – during the busy holiday season due to outdated technology and some winter weather.

The airline said that it was revamping its technology systems while offering affected passengers 25,000 in reward points and compensation for out-of-pocket expenses.

Industry experts expect this summer to be another busy travel season, with more than 2m flights from US airlines scheduled over the summer, between Memorial Day and Labor Day.

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