Airlines must pay over $600M to customers – what to do if you’re waiting on a refund

(NEXSTAR) – Frontier Airlines and five foreign carriers are paying customers hundreds of millions of dollars for canceling or significantly delaying their flights since the start of the pandemic, and officials have some new guidance for anyone waiting on a payment.

A Department of Transportation spokesperson confirmed to Nexstar that the airlines have already paid more than $600 million, but there may be more money owed.

“If consumers have not received a required refund by the six airlines or been informed by these airlines on how to obtain the refund owed, they should file a complaint with the Department,” the DOT spokesperson said in an email.

The DOT form covers a range of complaints, from overbooking to discrimination, and directs the information to the appropriate regulators. Any sexual misconduct allegations will also be forwarded to the FBI.

The U.S. Department of Transportation said it also fined the same airlines more than $7 million for delaying refunds so long that they violated consumer-protection rules.

The largest U.S. airlines, which accounted for the bulk of complaints about refunds, avoided fines, and an official said no other U.S. carriers are being investigated for potential fines.

Consumers flooded the agency with thousands of complaints about their inability to get refunds when the airlines canceled huge numbers of flights after the pandemic hit the U.S. in early 2020. It was by far the leading category of complaints.

“When Americans buy a ticket on an airline, we expect to get to our destination safely, reliably and affordably, and our job at DOT is to hold airlines accountable for these expectations,” Transportation Secretary Pete Buttigieg said.

In a consent order, the government charged that Frontier changed its definition of a significant delay to make refunds less likely, and an online system to process credits went down for a 15-day period in 2020.

U.S. law makes it illegal for airlines to refuse refunds and instead give vouchers when a flight to, from or within the U.S. is canceled or significantly changed, and the customer doesn’t want to take the alternative offered.

Frontier spokeswoman Jennifer de la Cruz told Nexstar the airline has paid $222 million to passengers since 2020 and nearly $100 million in “goodwill refunds” that were “over and above the DOT requirements.”

While current refund rules do not define what a “significant change” entails, the department proposed the following definition this past summer:

• Changes that affect the departure and/or arrival times by three hours or more for a domestic flight or six hours or more for an international flight;
• Changes to the departure or arrival airport;
• Changes that increase the number of connections in the itinerary; and 
• Changes to the type of aircraft flown if it causes a significant downgrade in the air travel experience or amenities available onboard the flight.

The international airlines that agreed to the refunds were TAP Portugal ($126.5 million in refunds and a $1.1 million fine), Air India ($121.5 million in refunds and a $1.4 million penalty), Aeromexico ($13.6 million in refunds and a $900,000 fine), Israel’s El Al ($61.9 million in refunds and a $900,000 penalty) and Colombia’s Avianca ($76.8 million in refunds and a $750,000 fine).

In 2020, United Airlines had the most refund-related complaints filed with DOT — more than 10,000 — although smaller Frontier had a higher rate of complaints. Air Canada, El Al and TAP Portugal were next, both over 5,000, followed by American Airlines and Frontier, both topping 4,000.

However, there will be no fines for other U.S. airlines because they responded “shortly after” the Transportation Department reminded them in April 2020 of their obligation to provide quick refunds, said Blane Workie, the assistant general counsel for the Transportation Department’s Office of Aviation Consumer Protection.

The Associated Press contributed to this report.