U.S. to propose new rules for airline cancellations, delays

The Biden administration is working on new regulations that would require airlines to compensate passengers and cover their meals and hotel rooms if they are stranded for reasons within the airline’s control.

The White House said President Joe Biden and Transportation Secretary Pete Buttigieg would announce the start of the rulemaking process Monday.

The rulemaking pledge continues a push by the Democratic administration to require airlines to improve customer service, and it comes just weeks before the start of the peak summer travel season.

The aim of the rules would be, for the first time, to require airlines to pay compensation beyond a ticket refund and to cover expenses that consumers incur, including rebooking on another flight, if the airline causes a cancellation or significant delay.

“When an airline causes a flight cancellation or delay, passengers should not foot the bill,” Buttigieg said in a statement.

Airline-caused cancellations include flights scrubbed for mechanical issues with the plane or lack of a crew.

Airlines for America, which represents the biggest carriers, said in a statement that airlines have no incentive to delay or cancel flights. The trade group said more than half of cancellations in 2022 and 2023 have been caused by “extreme weather” or air traffic control outages.

“Carriers have taken responsibility for challenges within their control and continue working diligently to improve operational reliability,” including hiring more workers and reducing their schedules, the group said.

After the pandemic hit, airlines paid tens of thousands of workers to quit or retire early, but they have added about 118,000 workers since November 2020 and now have 5% more employees than before the pandemic, according to Transportation Department figures.

There is no certainty if or when the Transportation Department might publish final rules around new compensation for travelers. The rule-making process can take months or years.

Currently, when an airline cancels a flight for any reason, consumers can demand a refund of the unused part of their ticket and certain extras that they might have paid to the airline, such as fees for checking a bag or getting a seat assignment. Airlines often try to persuade consumers to accept a travel voucher instead of a refund.

After widespread flight disruptions last summer, the Transportation Department posted an online dashboard that was designed to pressure the airlines to improve customer service. The site lets consumers check each airline’s policy on refunds and compensation when flights are canceled or delayed.

Each of the 10 largest U.S. airlines quickly promised to provide cash or vouchers for meals when a cancellation forces passengers to wait at least three hours for another flight. Nine of the 10—all but Frontier Airlines—also promised to pay for accommodations for passengers stranded overnight.

Questions arose again around reimbursing consumers for out-of-pocket costs after Southwest Airlines canceled nearly 17,000 flights during a December meltdown in service. The Transportation and Justice departments are investigating whether Southwest scheduled more flights than it realistically could handle.

The Transportation Department says it is working with the airlines to reduce cancellations and delays this summer, when air travel could exceed pre-coronavirus pandemic records.

A report last month from the congressional Government Accountability Office blamed airlines for a surge in cancellations as air travel began to recover in 2021 and early 2022. The Federal Aviation Administration has also created disruptions due to technology outages and staffing shortages. The FAA recently encouraged airlines to reduce flights to and from major New York airports this summer because it doesn’t have enough air traffic controllers at a key facility.