US new airline regulation to compel airline to pay cash for long delays, cancellation

The Biden administration on Monday announced plans for new regulations to require airlines to provide compensation and cover expenses for meals and hotel rooms to stranded passengers when the companies are at fault for travel disruptions. “When an airline causes a flight cancellation or delay, passengers should not foot the bill,” Transportation Secretary Pete Buttigieg said in a statement. “This rule would, for the first time in U.S. history, propose to require airlines to compensate passengers and cover expenses such as meals, hotels, and rebooking in cases where the airline has caused a cancellation or significant delay.”  

According to the Transportation Department, the proposals are aimed at requiring airlines to provide compensation to passengers when there is a “controllable airline cancellation or significant delay, including meals, transportation to and from the hotel and fees incurred when rebooking on another flight. Airlines currently do not guarantee cash compensation when an airline-related issue causes a significant delay or cancellation. Airlines often guarantee frequent flyer miles, travel credits or vouchers to passengers who experience delays or cancellations caused by an issue within the airline’s control, such as a mechanical issue. The Transportation Department said it seeks to ensure that passengers are better protected against financial losses with the proposed rules, and that it plans to define “controllable cancellation and delay” in this rule making.

The announcement comes as part of a push by the Biden administration to improve customer service to airline passengers. The Transportation Department unveiled an online dashboard designed to improve customer service after widespread flight disruptions last summer. The dashboard allows passengers to check an airline’s refund policy and compensation in the event of a flight cancellation or delay. Many of the largest U.S. airlines guarantee meals or hotel stays when they are at fault for a delay or cancellation, according to the dashboard. The department also said it believes that the proposed rules will help improve airlines’ on-time performance.

It launched an investigation into Southwest Airlines after thousands of its flights were canceled in late December. The department said it was investigating whether company executives scheduled an unrealistic volume of flights, “which under federal law is considered an unfair and deceptive practice.” The carrier said it is cooperating with all inquiries. NBC news