Experts say US airlines owe customers upwards of $20 billion in refunds due to canceled flights during the pandemic.
Passengers complaints have skyrocketed to over 100,000 since April 2020 due to a lack of refunds.The Department of Transportation had to intervene when airlines refused to offer refunds over a voucher.
Issues with refunds were the top complaints from airline passengers since the start of the pandemic, and carriers still owe travelers billions for canceled flights.
In June 2021, Senators Edward J. Markey (D-Mass.) and Richard Blumenthal (D-Conn.) revealed airlines are sitting on over $10 billion in owed refunds to customers after canceling hundreds of flights throughout 2020, though aviation experts said that the number is more likely upwards of $20 billion, reported CBS News.
According to federal law, airlines are required to offer refunds for canceled or significantly changed flights, though, during the COVID-19 outbreak, airlines have struggled to keep up.
The lack of refunds has caused thousands of frustrated passengers to file complaints with the Department of Transportation, which received nearly 90,000 complaints regarding refunds in 2020 alone, according to the agency. The mammoth number is almost 500% more than the total complaints filed in 2019, which was less than 1,600, based on DOT data.
“There has never been a year like last year for complaints about refunds,” Consumer Reports Advocacy aviation adviser, Bill McGee, told CBS MoneyWatch. “The airlines obviously made some conscious decisions not to do the right thing and give refunds even when they were required to by law.”
According to a recent study from consumer advocacy organization US Public Interest Research Group, Frontier Airlines had the highest number of complaints per 100,000 passengers in 2020. However, United had the most amount of complaints overall when tallied on a non-per-passenger basis, with a whopping 10,229 total filed last year, according to the DOT.
“Those two airlines [Frontier and United] had a chronic problem with not paying refunds,” McGee told CBS MoneyWatch.
United and Frontier did not respond to Insider’s requests for comment.
The issue has extended into 2021, with over 18,000 complaints filed since January, according to PIRG. The organization said in its report that “airlines continue to put up roadblocks for consumers seeking refunds,” causing customers to either still be waiting for their money back or sitting on travel credit that they can’t use.
During the pandemic, airlines offered vouchers or flight credit as a way to hold onto the capital instead of handing out refunds when a flight was canceled, which put some travelers in a sticky situation because they accepted a voucher over cash, sometimes without realizing they had a choice. However, by law, airlines are still required to offer a refund in lieu of a voucher, but it has been difficult for some passengers to get their money back.
Two enforcement notices have been issued by the DOT, according to the agency, reminding airlines about the refund requirement. Since the notice, the DOT said in September 2021 that it has initiated 20 investigations into airlines refusing refunds, with 18 still pending, and nine carriers have since changed their policies to make it clear customers are entitled to a refund instead of a voucher.
The agency did explain the actions were working, reporting that “thousands of passengers who had initially been denied refunds have received or are receiving the required refunds.”
Moreover, the DOT said it is looking to implement a new rule that would give customers more rights if they decide not to fly because of “government restrictions.” According to the agency, current rules do not cover this.