Biden administration’s latest regulations require airlines to provide immediate refunds for significant delays and cancellations, aiming to enhance consumer rights
The Biden administration has introduced stringent regulations that will transform how airlines handle cancellations and significant delays. Announced on Wednesday, the new rules compel airlines to issue automatic cash refunds promptly, marking a significant shift in airline consumer rights.
Under the revised regulations, airlines must now provide cash refunds within days for cancelled flights and substantial delays. The Transportation Department has set clear standards, categorizing a delay as significant if it lasts three hours for domestic flights and six hours for international flights.
Previously, airlines had the autonomy to determine the threshold for a delay warranting a refund. However, this discretion has been removed, providing consumers with greater certainty and control over their travel plans. If a flight is delayed or cancelled, airlines may still offer a rebooking on another flight or travel credit, but passengers now have the explicit right to reject these alternatives and opt for a refund instead.
The rule also extends to ancillary services and fees, a common grievance among travellers. For instance, if an airline fails to deliver a checked bag within 12 hours after a domestic flight or between 15 to 30 hours for international flights, it must refund any associated baggage fees. Similarly, fees for additional services like seat selection or internet access must be refunded if the service is not provided.
These regulations come in response to a surge in complaints during the COVID-19 pandemic, when many flights were cancelled or significantly delayed, and passengers struggled to obtain refunds. The trade group Airlines for America has recognized the decline in complaints since mid-2020, citing that major U.S. airlines have issued $43 billion in refunds from 2020 through 2023.
Additionally, the new rules mandate that airlines and ticket agents disclose all potential fees upfront when showing initial prices and schedules on their websites. This requirement is aimed at eliminating hidden costs and ensuring transparency, which Airlines for America claims its members already strive to provide.
The Transportation Department anticipates these changes will save consumers over $500 million annually. The regulations are part of a broader initiative by President Joe Biden to combat what he terms “junk fees,” enhancing protections for airline passengers. These rules are set to be implemented gradually over the next two years.
