Biden Administration Orders Six Airlines to Pay Customers More Than $622 Million in Pandemic Refunds

The Department of Transportation has ordered six airlines to pay consumers more than $622 million in owed pandemic-era refunds on top of more than $7.25 million in civil penalties for dragging out their refund processes.

The biggest loser was Frontier Airlines which has been told to pay its passengers more than $222 million in refunds, alongside a $2.2 million civil penalty.

An investigation by the DOT’s Office of Aviation Consumer Protection found that Frontier retroactively changed its definition of a ‘significant schedule change’ at the start of the pandemic, leaving tens of thousands of passengers out of pocket.

Frontier maintains to this day that its money-saving policy change wasn’t unfair or deceptive and that the airline had received “very few” complaints about its schedule change policy.

Up until the start of the pandemic, the Denver-based carrier considered a three hours time difference in a flight’s departure time as a ‘significant schedule change’ but for a nearly eight-month period in 2020 Frontier amended the definition to make the policy less generous.

If passengers could be accommodated on a flight on the same calendar day, the airline would only offer vouchers rather than a cash refund. The policy was retroactively applied to passengers who had bought tickets when the old policy was in force.

“When a flight gets canceled, passengers seeking refunds should be paid back promptly,” commented U.S. Transportation Secretary Pete Buttigieg after the fines were announced.

“Whenever that doesn’t happen, we will act to hold airlines accountable on behalf of American travelers and get passengers their money back,” Buttigieg continued. “A flight cancellation is frustrating enough, and you shouldn’t also have to haggle or wait months to get your refund.” 

As well as Frontier, the five other airlines that were slapped with enforcement action were:

• Air India – ordered to pay $121.5 million in refunds and a $1.4 million penalty
• TAP Portugal – ordered to pay $126.5 million in refunds and a $1.1. million penalty
• Aeromexico – ordered to pay $13.6 million in refunds and a $900,000 penalty
• El Al – ordered to pay $61.9 million in refunds and $900,000 penalty
• Avianca – ordered to pay $76.8 million in refunds and a $750,000 penalty

Many of the airlines said they had not deliberately withheld refunds from consumers but that an unprecedented surge in refund requests at the start of the pandemic left them overwhelmed and unable to cope with the demand.

Many consumers had to wait months for their requested refunds, while some had to wait more than a year.

Buttigieg has suggested that more penalties and enforcement action against other airlines – both domestic and international airlines – could be announced in the near future.

The Biden administration’s DOT has taken a consumer-friendly stance and has promised to crack down on hidden airline fee’s.