Airlines’s trickery

Frontier Airlines’s trickery helped inspire new DOT ruling

The DOT cracks down on airlines over their refund policies

By Olivia Harden

Air travel passengers might not have to suffer from jumping through hoops to receive a refund if an airline cancels a flight.

The Biden administration and the Department of Transportation announced Wednesday a new policy that streamlines the air travel system by requiring airlines to provide automatic cash refunds for flight cancellations, significant delays and other travel inconveniences caused by an airline.

The policy shift comes after the DOT began investigating how airlines reimburse passengers for delays and cancellations in the years following the start of the pandemic. Frontier Airlines, for instance, was issued a $2.2 million penalty in 2022 after the DOT determined the airline failed to provide customers with timely refunds for flights that Frontier had significantly changed. 

Under the new policy, for significantly altered flights, airlines must issue full refunds within seven business days for credit card purchases or 20 calendar days for purchases via other payment methods. 

The reimbursements are for passengers whose flights are canceled, whose domestic flights are delayed by more than three hours, or whose international flights are delayed by at least six hours. Airlines will also need to refund passengers who require significant changes to reach their destination — including changing the departure or arrival airport, increasing the number of connecting flights or downgrading their service class.

On-time arrivals averaged around 78% between January 2023 and January 2024, according to the DOT. A recent study by NerdWallet found Frontier and JetBlue to be the worst offenders. 

The new policy covers baggage delays; customers who do not receive their bags within 12 hours for domestic flights or within 15-30 hours for international flights (depending on flight time) will receive an automatic refund for the cost of checking their bags. It also protects disabled people who have to make connections at a different airport or on another flight that isn’t as accessible or has fewer accommodations.

Passengers are also entitled to a refund for fees for additional services like Wi-Fi, seat selection and entertainment if those amenities are not available for use. 

“Passengers deserve to get their money back when an airline owes them — without headaches or haggling,” U.S. Transportation Secretary Pete Buttigieg said in a news release. “Our new rule sets a new standard to require airlines to promptly provide cash refunds to their passengers.” 

The new policy states that all refunds must trigger automatically, without requiring the customer to jump through hoops like phone calls to the airline or filling out paperwork. Airlines must pay in cash or return the fare in the original form of payment. Payment cannot be provided in vouchers or travel miles, unless specifically requested by the customer. The reimbursements must be for the full amount, minus the value of any parts of the travel already used. 

Secretary Buttigieg signed the final rule April 1. The DOT submitted it to the Federal Register, and the rule goes into effect 60 days after its publication.