Opinion | Feds make two changes to airline travel rules


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Bill Saporito is editor at large at Inc. magazine.

In the glamour days of airline travel — that is, before we all became cargo — carriers had to abide by the little-known Rule 240. That regulation dictated that if, say, your Trans World Airlines flight from New York to Los Angeles was delayed by four hours, and Pan Am had space on an earlier departure, TWA had to revalidate your ticket on Pan Am. Only catch was: you had to know the rule.

The carriers didn’t exactly broadcast the existence of Rule 240 and hardcore fliers kept it to themselves, along with their pocket Official Airline Guides — the monthly paperback of scheduled flights that we depended on before the internet.

Rule 240 withered with airline deregulation and in 2020, the Transportation Department allowed each carrier to write its own individual contract of carriage regarding cancellations, rebookings and refunds. This was a little like granting electric utilities the right to establish their own emission standards.

Today, of course, Pan Am, TWA and the bulky OAGs are all gone. We can use our smartphones to know everything about current and future flights instantly. But it’s pretty much useless information. There are limited alternatives when flights are canceled or delayed because of weather, labor shortages or air traffic control. That’s because airlines, in the name of maximizing capacity, have few spare jets on hand for backups.

The result is, well, what happened this summer, which according to the Transportation Department has featured “an unacceptable level of flight delays and cancellations.” Passengers have been stranded for days at airports, or spent hours waiting in long lines, or found themselves stuck on hold with customer service, after flights have been delayed, canceled or rescheduled.

After months of jawboning the carriers, Transportation Secretary Pete Buttigieg is finally laying down the law. Or, at least, laying down a Notice of Proposed Rulemaking (NPRM) that aims to speed refunds to passengers when carriers cancel or delay flights, in part by defining what, exactly, constitutes a cancellation or unacceptable delay.

It’s a good move, so far as it goes. The NPRM will define a “canceled flight” as one that is “published in the carrier’s Computer Reservation System at the time of the ticket sale but not operated by the carrier.” Which could mean almost anything, but in practice should mean that if a flight is canceled or departs three or more hours late, passengers are then entitled to refunds within seven business days. The carriers can offer travel vouchers, but they must first inform passengers that they can get a refund. The proposed rule states that the reason for the cancellation — weather, air traffic hold, mechanical, pandemic — doesn’t matter.

Before the proposed rule was issued, the industry’s trade association argued that passengers who buy nonrefundable tickets should bear all the risks of cancellation. If passengers want to be entitled to refunds, the airlines said, they should buy higher-priced, fully refundable tickets. The Transportation Department commendably declined to accept that logic, saying: “A reasonable consumer would not expect that he or she must pay more to purchase a refundable ticket in order to be able to recoup the ticket price when the airline fails to provide the service paid for through no action or fault of the consumer.”

Another useful change came just ahead of Labor Day weekend, when the Transportation Department introduced what it calls the Airline Customer Service Dashboard, which allows passengers to see what the carriers are committed to doing for them in cases of “controllable” (meaning, their fault) cancellations or significant delays. This is known as “reaccom” in the trade — reaccommodation — and could take the form of rebooking you on the same airline for no added cost, or even on a competitor’s. Just like the days of Rule 240.

As the dashboard shows, though, some carriers aren’t going to be all that reaccommodating. Ultralow cost carriers such as Allegiant and Frontier, for instance, will rebook you on their own flights but not another carrier’s. Nor is Frontier going to provide a hotel in the case of an overnight cancellation or delay. The majors, having been tipped off by the Transportation Department about the dashboard some weeks ago, now seem more amenable to things such as handing out food vouchers in case of long delays or providing hotel rooms when they scratch evening flights. Although the carriers already do some of this, now passengers can use a simple dashboard rather than trying to read through the contract of carriage on a carrier’s website to know what they’re entitled to — or not.

That could help airline employees who now have to face confused, angry passengers, too.

When the travel network seizes up, as it often did this summer, the airlines employ software, along with some experienced humans, to decide which flights to cancel. The idea is to minimize both economic and passenger dislocation. For instance, flights with a lot of “terminators”— that is, passengers who are ending their journeys where the plane lands — are more prone to get the ax than those loaded with passengers connecting to another flight, especially an international one.

The airlines have got the cancellations down to a science. What the Transportation Department is saying now is that more rigor in dealing with the consequences of delays and cancellations is as overdue as some of the flights.



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