Democrats in both houses of Congress have filed a bill that would require airlines to refund passengers who cancel trip plans up to 48 hours before their scheduled flight.
The Cash Refunds for Flights Cancellations Act would also require airlines to clearly disclose that passengers are entitled to a refund when the airline cancels or significantly delays a flight. It would require airlines to retroactively refund passengers who took flight credits for flights canceled by their airline since the start of the Covid-19 pandemic, but who now would like to convert whatever remains of those credits into cash. And it would require that flight credits taken by a passenger in lieu of a refund not be subject to an expiration date.
"It's time to hold the airlines accountable, because travelers shouldn't pay the price for flight delays and cancellations," said Rep. Jesus Garcia (D-Ill.), who is one of the bill's sponsors. "Customers should be able to receive cash refunds instead of company credit or miles they may not be able to use, and this bill is about ensuring they get what they are owed without spending hours in line or on the phone."
Other sponsors are senators Ed Markey (D-Mass.), Sheldon Whitehouse (D-R.I.) and Elizabeth Warren (D-Mass.) and representatives Steve Cohen (D-Tenn.) and Jamie Raskin (D-Md.).
Their proposal coincides with a summer of elevated cancellations and delays among airlines that has ratcheted-up public scrutiny on carriers. It also follows widespread complaints about how airlines have handled refunds during the pandemic, especially during the pandemic's first few chaotic months.
In a statement, Airlines for America (A4A) said that in 2020 and 2021, airlines issued a combined $21 billion in cash refunds, compared with $7.5 billion in 2019. Major U.S. carriers also did away with change fees in 2020.
"A4A member carriers comply with federal laws and regulations regarding cash refunds," the trade group said. "Carriers strive to provide the highest level of customer service and are committed to working with travelers to address their individual circumstances."
DOT pursuing action against airlines
Last year, the DOT fined Air Canada $4.5 million for violating the federal refund regulations. And the Transportation Department says that it is currently pursuing action against 10 other airlines. The department hasn't disclosed which carriers, however, and says it can't do so because the cases are ongoing.
Under existing U.S. regulations, airlines are required to provide refunds upon request when they cancel or significantly delay a flight. The DOT is planning a regulatory review that, among other things, would provide more clarity as to what counts as a significant delay. As part of that review, the department has also said it will consider whether to require airlines to provide refunds to individuals who choose not to fly during a public health emergency due to government restrictions and advisories.
The Cash Refunds and Flight Cancellations Act would take that latter question mostly out of the DOT's hands with its requirement that refunds be issued for all cancellations made by passengers up to two days before a flight.
In addition, it would address the common airline practice of not informing passengers about the option of a refund as they offer flight credits for cancellations. If enacted, the legislation would require that airlines send communications disclosing to passengers that they have a right to a refund.