That COVID-19 airline refund you’re entitled to might require you to ... un-complain

Most airlines won’t be getting good conduct medals for their handling of refunds for flights they canceled when the pandemic brought the world — and the airline industry — to its knees. Some carriers whined; some dragged their feet; many tried to solve their liquidity problems by offering vouchers to consumers instead of cash.

And now, at least one has made a refund contingent on the consumer’s withdrawing of his complaint to the U.S. Department of Transportation.

Many of you have written to me with complaints about airlines, especially foreign carriers, that have been slow to refund money for flights they canceled. (If the airline canceled, you’re entitled to a refund; if you canceled, you get a voucher, according to DOT rules.)

Garth Follett of Novato, Calif., got caught in refund roulette with Philippine Airlines. We recounted his struggles in a September column and have continued trying to get a refund for his canceled March flight. E-mails to corporate executives were ignored, and it was almost impossible to get through by phone.

My last-ditch effort was an email to Gilbert Santa Maria, PAL’s new president and chief operating officer.

Amazingly, not long after that missive, I received a response from Jose Perez de Tagle, vice president of corporate communications for PAL. He apologized for the delay in responding and explained that financial problems and staff cutbacks had delayed refunds but that the airline was working on it.

PAL said it sent its customers a letter in September saying that, but its Facebook page is still full of complaints about refunds. On Oct. 30, I did offer every complainant an opportunity to tell me their stories, which I happened to mention to PAL.

I responded to the communications vice president by thanking him for reaching out and asking him whether customers should have to bear the burden of his airline’s liquidity problem. No answer yet on that question. But I did receive an email from Follett two days later saying he had received the $1,172 he had paid to PAL in January.

Chalk one up for the consumer. It took only a combined 67 million hours and so many calls to the Philippines that an overseas service rang me last week to ask whether I would like a discount calling plan to the island nation. I declined.

The glow from that was tempered by an email from Scott B. Halperin of Florida, who had sought a refund from Air Canada. Think Canadians are friendly? Air Canada may alter your outlook.

Air Canada canceled Halperin’s May 21 flight from Orlando, Fla., (his home airport) to Montreal. In an email, the carrier offered him a voucher. Halperin wanted a refund instead, to which the U.S. DOT says he or anyone else is entitled if the canceling airline does business in the U.S., which Air Canada does.

Halperin filed a complaint with the DOT, the first step to take in a refund battle (lat.ms/DOTcomplaintform). Eventually, he received, by email, a settlement agreement from Air Canada.

Within the text, full of “Hey, this was all outside our control” and “We’re complying with Canadian rules, for heaven’s sake” and “But we’re good guys and want to be your BFF” is this gem: Halperin will get a refund, the document says, if he will agree to “withdraw his/her complaint with the DOT.”

Yes, the settlement form really says that Air Canada will refund Halperin’s money only if Halperin un-complains to the DOT.

I asked the DOT and Air Canada for their thoughts. The DOT reiterated that “U.S. and foreign air carriers have a longstanding obligation to provide a prompt refund to a ticketed passenger, including those with non-refundable tickets” if the airline canceled the flight, which it did. It notes too that the DOT told carriers in an enforcement notice on April 3 and May 12 that these are the rules.

Air Canada disputes the DOT’s authority because, a spokesman said in an email, “both the Enforcement Notice and the Department’s COVID-19 Refund FAQs constitute agency guidance documents, as opposed to properly issued regulations under the Administrative Procedures Act.

“As mere guidance, they cannot overrule or supersede the Department’s well-established regulatory framework, as instituting a new regulation requires public notice and comment. Indeed, the Department’s COVID-19 Refund FAQS document acknowledges that it ‘does not have the force and effect of law and is not meant to bind the regulated entities in any way.’”

The DOT disputes Air Canada’s dispute. “The Department’s Office of Aviation Consumer Protection has long taken the view that a carrier that refuses to provide passengers a refund, upon request, in circumstances where the carrier has cancelled the flight or has made a significant schedule change and the passenger does not wish to accept a voucher for future travel or the alternative carriage offered by the airline, is engaged in an unfair business practice in violation of section 41712,” a DOT spokesman said in an email. To read the section, go to bit.ly/DOT41712

If this were a coin toss, it would be heads, Air Canada wins, and tails, Air Canada wins.

In July, the DOT received 11,117 complaints about airline service from consumers, according to the Bureau of Transportation Statistics report, issued in September. Roughly half the complaints were about foreign carriers, the vast majority about refunds. In refund complaints among international airlines, Air Canada ranked second with 653.

Meanwhile, I’ll continue to work on refund requests others of you have submitted and report back on those as well as Halperin’s case. I have a feeling that battle is not over. Halperin’s job? He’s a plaintiff’s attorney.

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