Saturday, July 26, 2014

The one rule your airline hates the most - Elliott


If there’s one regulation that airlines hate more than anything, it’s the 24-hour rule.

Can you blame them? In 2012, the Transportation Department required air
carriers to allow you to hold a reservation without payment or cancel a
booking without penalty for 24 hours after your reservation, with some

That allowed passengers to fix mistakes, such as a misspelled name or
a wrong date. They could just cancel the ticket and rebook, as long as
their departure date was more than a week away. But this
government-mandated “out” clause probably also cost airlines millions in

Now, regulators want to expand that rule to travel agencies,
requiring that they also offer the same option for customers. A vast
majority of agents already abide by the 24-hour rule, but a few travel
retailers have discovered ways to weasel their way out.

If history is any guide, this rule will be as tough to enforce as
version one. Unscrupulous ticket sellers love to redefine “day” or add
new policies of their own to make it difficult to invoke this
controversial clause. The only way we’ll benefit from this proposed
regulation, assuming it’s adopted, is if we remember it — and invoke it.

Consider what happened to Shannon Harrell, a nursery school teacher
who lives in Como, Italy. She paid $4,600 for round-trip tickets from
Milan to Seattle this summer for her and her two sons. Within a few
hours, she discovered a mistake. But when she tried to cancel the
itinerary, a representative for eDreams, the European online agency
she’d booked her tickets through, told her she was too late. The
agency’s policy was only to refund the flight if canceled the same day,
not within 24 hours.

“I just can’t believe that there’s nothing I can do but lose that money,” she says.

EDreams did not respond to questions about its refund rules.

It’s not just online agencies. Another reader, Christina Conte, was
fare-shopping on the British Airways website when she noticed a pop-up
window that cheerfully announced it offered “free” cancellations, as
long as they were made within four hours. If she caught the mistake
after then, but before her 24 hours were up, British Airways would
charge her a “small fee.”

The Transportation Department has kept busy enforcing its 24-hour
rule for airlines. Two summers ago, it fined EgyptAir $60,000 for
violating rules requiring the disclosure of, among other things, the
24-hour rule. That September, it dinged Aeroflot with the same penalty,
also for a 24-hour rule violation. Last May, the department issued an
advisory reminding airlines that “carriers may not deceive consumers
about the 24-hour reservation requirement.”

Clearly, airlines want your tickets to be completely non-refundable
from the moment you push the “buy” button. So do online travel agencies.

No one knows how much money airlines were able to pocket because of a
“no refunds” rule before 2012, but it’s likely that in the years since
the DOT’s 24-hour rule went into effect, some ticketing agencies may
have benefited by extracting a refund from an airline, then keeping a
passenger’s money because of their own internal no-refunds policy.

To keep your money, agencies and airlines occasionally come up with
“creative new twists” that allow them to circumvent regulations, says
Michal Ann Strahilevitz, a marketing professor at Golden Gate
University. The most common tactic is to interpret 24 hours as a day,
and to tell customers they have until the end of the next business day,
even when they complete their reservation at 11 p.m. That would give
customers less than 24 hours.

“This is not the norm, and most good online travel agencies do honor
the 24-hour rule exactly as it should be honored,” she says.

Online travel agencies seem cool to the Transportation Department’s
latest proposed set of consumer protections, and no matter how
well-intentioned, they are unlikely to be met with their approval.

In a perfect world, requesting that your travel agent refund an
airline ticket within 24 hours shouldn’t be necessary. It’s not a
perfect world.

Should the 24-hour rule be expanded to agencies?

View Results
Make the 24-hour rule work for you

Invoke the rule. The 24-hour rule is widely
interpreted to apply to airline reservations, regardless of where
they’re made. Remind your travel agency of the rule, and you’ll likely
get a refund.

Contact the DOT. File a complaint via the
Transportation Department’s Aviation Consumer Protection Division: A letter from DOT is often
enough to secure a refund, even when technically, you’re not entitled to
one under the existing rule.

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