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New Bill Requires Airlines to Offer Full Refunds—Even if the Customer Canceled

By Michelle Baran

May 16, 2020

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If you canceled a flight due to COVID-19, there’s still hope for a refund.

Photo by momente/Shutterstock

If you canceled a flight due to COVID-19, there’s still hope for a refund.

A group of senators introduced legislation this week that would ensure that travelers get reimbursed for deciding not to fly during the coronavirus pandemic.

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A new bill introduced in the U.S. Senate this week would require airlines and third-party ticket vendors to offer full cash refunds for all flight cancellations during the coronavirus pandemic, regardless of whether the airline canceled the flight or the passenger canceled his or her individual flight booking by choice.

The Cash Refunds for Coronavirus Cancellations Act of 2020 was presented in the Senate on Wednesday, and while it requires airlines to provide the option of a full refund, it would still allow them to continue to offer travel vouchers as an alternative to cash refunds as long as the voucher is valid indefinitely and the offer clearly states that the traveler has a right to a cash refund.

If passed into law, the legislation would be retroactive and would apply to any flight that took place or was scheduled to take place on or after March 1, 2020. Passengers who have received a travel voucher in lieu of a refund would be able to request a cash refund. The bill mandates that cash refunds be available up until 180 days after the end of the national declaration of emergency due to the COVID-19 outbreak, which went into effect on March 1.

Airlines would be allowed to pay for the refunds using any of the financial assistance they received from the government’s coronavirus relief funds—a $2 trillion package known as the CARES Act that set aside $50 billion for U.S. airlines—with the exception of funds that were designated for airline employees.

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The government already requires airlines to issue refunds for flights they canceled

The new bill was introduced after the U.S. Department of Transportation (DOT) last month reminded U.S. and foreign airlines that they remain obligated to refund passengers when they cancel a scheduled flight to, within, or from the United States, or make a significant schedule change. Only offering a future flight credit doesn’t cut it, according to the DOT.

The DOT’s notice was prompted by what it said has been a growing number of complaints from passengers who were denied refunds for canceled flights and were being offered vouchers or credits for future travel instead.

That DOT’s renewed mandate, however, applies only to flights canceled by the airlines themselves, not to flight bookings canceled by travelers who have chosen not to fly during the pandemic when their flights continue to operate.

The bill introduced this week pledges to change that and would make it a requirement regardless of which entity canceled—the airline or the passenger.

“Americans need cash in their pockets to pay for food, housing, and prescriptions, not temporary credits toward future travel,” Senator Edward Markey of Massachusetts, one of the bill’s coauthors, said in a statement about the proposed legislation. “In light of this pressing need, and an unprecedented multi-billion-dollar bailout, it’s absolutely unconscionable that the airlines won’t give consumers their money back.”

The legislators argued that most airlines continue to push the option of rebooking passengers and future flight credits as the default and are forcing customers to jump through hoops to get their money back.

Senator Chris Murphy of Connecticut pointed out that rebooking is not a practical option for many consumers given the uncertainty of the pandemic.

“Working families everywhere are being crushed under the weight of this pandemic, and they need cash returned to them now to help feed their loved ones, put a roof over their heads, and pay for their health-care needs,” stated Senator Elizabeth Warren of Massachusetts, one of the bill’s cosigners.

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How to get a refund for a flight cancellation

Unless the Cash Refunds for Coronavirus Cancellations Act of 2020 is passed into law (for which no precise timeline was provided), consumers are still currently only protected for flights that were canceled or significantly delayed by the airlines.

But even for those refunds, persistence is key, according to Christian Nielsen, chief legal officer for AirHelp, a claims management company that helps passengers get reimbursements.

“Because so many travelers are seeking to change their plans, airlines are bogged down, so travelers should try to exercise patience,” said Nielsen, who noted that customers shouldn’t hesitate to use any and all avenues of communication: email, airline chat portals, and phone. (At AFAR we’ve also noticed that the airlines have become very responsive on social media in the wake of the coronavirus pandemic.) “If possible, travelers should do everything through written correspondence, so there is a clear paper trail.”

If at first you don't succeed, try, try again. And you can also reach out to the DOT to file a complaint there as well.

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