Tag Archives: airline fees

USDOT Unveils Dashboard, Highlights Progress to Help Parents Avoid Family Seating Junk Fees  on Airlines

The U.S. Department of Transportation (USDOT) is making it easier for parents to avoid paying junk fees to sit with their children when they fly by rolling out a new family seating dashboard that highlights the airlines that guarantee fee-free family seating, and those that do not.  © Karen Rubin/news-photos-features.com

As USDOT works to ban family seating junk fees, new tool spotlights progress made on pushing airlines to guarantee parents can sit with their children fee-free 

WASHINGTON – Today, the U.S. Department of Transportation (USDOT) is making it easier for parents to avoid paying junk fees to sit with their children when they fly by rolling out a new family seating dashboard that highlights the airlines that guarantee fee-free family seating, and those that do not. As recently as a month ago, no U.S. airlines guaranteed fee-free family seating. Now, after weeks of USDOT and the Biden Administration pressing airlines to improve their customer service, American Airlines, Alaska Airlines, and Frontier Airlines have stepped forward to guarantee that parents can sit with their young children without getting nickel and dimed. While this represents significant progress, USDOT is not stopping there – and has already begun work on a common-sense rulemaking to ban airlines from charging families junk fees to sit together.  

“Parents traveling with young kids should be able to sit together without an airline forcing them to pay junk fees,” said U.S. Transportation Secretary Pete Buttigieg. “We have been pressing airlines to guarantee family seating without tacking on extra charges, and now we’re seeing some airlines start to make this common-sense change. All airlines should do this promptly, even as we move forward to develop a rule establishing this as a requirement across the board.”    
 

Last summer, Secretary Buttigieg pressed U.S. airlines to do more for passengers who had a flight canceled or delayed because of the airline. He informed the CEOs of the 10 largest U.S. airlines that the Department would publish a dashboard on amenities and services provided such as rebooking, meals, or hotels in the event of a controllable delay or cancellation. Prior to his urging, none of the 10 largest U.S. airlines guaranteed meals or hotels when a delay or cancellation was within the airlines’ control, and only one offered free rebooking. Now, all 10 airlines guarantee meals and rebooking, and nine guarantee hotels when an airline issue causes a cancellation or delay. 

Like the prior dashboard, the Department’s family seating dashboard provides a clear comparison of services the airlines have committed to provide, which will assist consumers when deciding which airline to fly. It makes it easier to know which airlines have stepped up and guarantee adjacent seats for young children traveling with an accompanying adult at no additional cost and which airlines do not.  
 
USDOT issued a notice last July stating that it is the Department’s policy that U.S. airlines ensure that children who are age 13 or younger are seated next to an accompanying adult with no extra charge. During a four-month review period following that notice, USDOT found that none of the airlines guaranteed family seating at no additional cost even though most asserted that they would make best efforts. This new dashboard allows parents to sidestep airlines’ confusing claims on family seating. To receive a green check on the dashboard, an airline must guarantee that parents can sit next to children age 13 and younger for free if adjacent seats are available when they book. And they must include that guarantee as part of their customer service plan so that it is backstopped by USDOT enforcement if they fail to deliver. 
 
Since most airlines currently do not guarantee that they will seat a parent and a child together at no extra cost, USDOT has begun work on a rulemaking to ensure a young child is able to sit adjacent to an accompanying adult. Because the rulemaking process can be lengthy, the President has called upon Congress to enact legislation, and the Administration plans to send Congress proposed legislation in the coming weeks. This is just one part of USDOT’s and the Administration’s ongoing efforts to strengthen consumer protections.  
 
Additional work that USDOT has done to protect traveling public includes: 

  • USDOT issued the largest fines in the history of the consumer protection office last year, primarily for failing to provide timely refunds. 
     
  • Since taking office, Secretary Buttigieg and USDOT have helped get hundreds of thousands of people more than $1 billion back in refunds. 
     
  • NPRM on Airline Ticket Refunds and Consumer Protections. The Department’s proposed rule on Airline Ticket Refunds, if adopted, would: 1) require airlines to proactively inform passengers that they have a right to receive a refund when a flight is canceled or significantly changed, and 2) define a significant change and cancellation that would entitle a consumer to a refund. The rule would also 3) require airlines to provide non-expiring vouchers or travel credits when people can’t travel because they have COVID-19 or other communicable diseases; and 4) require airlines that receive significant government assistance in the future related to a pandemic to issue refunds instead of non-expiring travel credits or vouchers when passengers are unable or advised not to travel because of a serious communicable disease.  A public hearing on this rulemaking is scheduled to take place on March 14, 2023, and you can register here to attend this hearing. 
     
  • NPRM on Enhancing Transparency of Airline Ancillary Service Fees. Under the proposed rule, airlines and travel search websites would have to disclose upfront – the first time an airfare is displayed – any fees charged to sit with your child, for changing or cancelling your flight, and for checked or carry-on baggage. The proposal seeks to provide customers the information they need to choose the best deal. Otherwise, surprise fees can add up quickly and overcome what may look at first to be a cheap fare.   A public hearing on this rulemaking is scheduled to take place on March 16, 2023, and you can register here to attend the hearing. 

For information about airline passenger rights, as well as DOT’s rules, guidance, and orders, the Department’s aviation consumer website can be found at: https://www.transportation.gov/airconsumer.

Biden Acts to Reduce Credit Card, Concert, Resort, Phone Termination Fees Saving Consumers $Billions

President Biden Calls for a Junk Fee Prevention Act to Eliminate Unfair and Costly Junk Fees 

Times Square NYC where you can use credit cards to buy souvenirs, theater and concert tickets, mobile phones, hotel accommodations. President Biden is proposing to save consumers billions of dollars in fees on everything from surprise resort and destination fees, to concert tickets, early termination for TV, phone and internet, and bank accounts and credit cards © Karen Rubin/news-photos-features.com

As part of the fourth meeting of the President’s Competition Council, the Biden-Harris Administration is announcing two actions that further advance the President’s agenda of promoting competition in the American economy. First, the Consumer Financial Protection Bureau (CFPB) is proposing a rule that would slash excessive credit card late fees, pursuant to its authority under the bipartisan Credit CARD Act of 2009. The rule is projected to reduce typical late fees from roughly $30 to $8, saving consumers as much as $9 billion a year in late fees. Second, the Department of Commerce’s National Telecommunications and Information Administration (NTIA) is releasing a report assessing the barriers to competition in the current mobile app store ecosystem and providing recommendations to level the playing field for app developers and give consumers more control over their devices.

The President will also highlight the Administration’s steady progress in eliminating or limiting junk fees: those hidden or unexpected fees that Americans pay each day that can total hundreds of dollars a month. Junk fees are not only costly to consumers, but they can stifle competition by encouraging companies to use increasingly sophisticated tools to disguise the true price consumers face. By reducing these fees and increasing transparency, we can provide relief to consumers and make our economy more competitive, particularly for new and growing businesses.

Since the President urged agencies to focus on reducing junk fees at the September 2022 meeting of the Competition Council, agencies have delivered in the following ways:

  • The CFPB targeted overdraft and bounced check fees, releasing two reports in 2021 and ramping up its oversight, driving 15 of the 20 largest banks to agree to put an end to bounced check fees. The CFPB followed up by releasing guidance banning surprise overdraft fees – fees charged for overdrawing a checking account even though at the time of purchase there appeared to be sufficient funds – and surprise depositor fees charged when you deposit someone else’s bounced check. These changes will reduce fees by more than $1 billion annually.
     
  • The Department of Transportation (DOT) proposed a rule to require airlines and online booking services to show the full price of a plane ticket up front, including baggage and other fees. DOT also published a dashboard of airline policies when flights are delayed or cancelled due to issues under the airlines’ control, leading 9 airlines to change policies to guarantee coverage of hotels and 10 airlines to guarantee coverage of meals, none of which was guaranteed before.
     
  • The Federal Communications Commission (FCC) released new rules that will go into effect next year to require broadband providers to use “nutrition labels”—similar to those used for food products—to convey key information to consumers about internet service options in an accessible format. The information featured will include prices, speeds, data allowances, and any additional fees charged.

Even as the Administration is taking these significant steps to use existing authority to eliminate junk fees, the President is calling on Congress to pass a Junk Fee Prevention Act that cracks down on four types of junk fees that cost American consumers billions of dollars a year.

Specifically, the President is urging Democrats and Republicans in Congress to come together to:

Crack down on excessive online concert, sporting event, and other entertainment ticket fees. Many online ticket sellers impose massive service fees at check-out that are not disclosed when consumers are choosing their tickets. In a review of 31 different sporting events across five ticket sellers’ websites, service charges averaged more than 20% of the ticket’s face value, and total fees—like processing fees, delivery fees, and facility fees—reached up to more than half the cost of the ticket itself. A family of four attending a show could end up paying far more than $100 in fees above and beyond the cost of the tickets.

Significant concentration in the industry—and a lack of consumer options—makes matters worse. Often, if Americans want to attend a particular concert or sporting event, they only have one online option for making the initial ticket purchase. That means that even if consumers knew they might have to pay a large fee on top of the ticket cost, they would have no way to avoid it if they wanted to attend a particular show. One company has exclusive partnerships with a reported 80 of the top 100 arenas in the United States, allowing it to charge fees to attend events at those leading venues without fear of competition.

While antitrust enforcement agencies have the authority to investigate and address anti-competitive conduct in the industry, the President urges Congress to act now to reduce these fees through legislation. Specifically, the President is calling on Congress to prohibit excessive fees, require the fees to be disclosed in the ticket price, and mandate disclosure of any ticket holdbacks that diminish available supply.

Ban airline fees for family members to sit with young children. Many airlines today charge a fee to select a seat in advance, including for those traveling with children. Parents can find themselves unexpectedly not seated with their young child on a flight or paying large fees to sit next to their children. The President believes no parent should have to pay extra to sit next to their child. 

In July 2022, the DOT issued a notice stating that it is the Department’s policy that U.S. airlines ensure that children who are age 13 or younger are seated next to an accompanying adult with no extra charge, but still no airline guarantees fee-free family seating. DOT will publish a family seating fee dashboard and launch a rulemaking to ban the practice. The President is calling upon Congress to fast-track the ban on family seating fees so that the DOT can crack down on these practices more quickly than through a rulemaking. 

Eliminate exorbitant early termination fees for TV, phone, and internet service. Too often, cable TV, internet, and mobile phone providers have “early termination” fees that consumers must pay if they want to switch to another provider. These fees can exceed $200. Early termination fees are costly for consumers and undermine economic dynamism by making it harder for innovative companies to win a toe-hold in the market by encouraging customers to switch. And these providers often charge people when they’re most vulnerable—people who are forced to move because of a job loss or other financial downturn, for example, may be slammed with hundreds of dollars in early termination fees.

The President urges Congress to eliminate these excessive early termination fees so that companies can no longer lock in customers and must truly compete with each other on the basis of price and quality.

Ban surprise resort and destination fees. When families set their budget for a vacation, they expect that the hotel price they see is the price they will pay. But many travelers encounter surprise “resort fees” or “destination fees” when they check out or at the end of a lengthy online reservation process. These fees harm consumers by preventing them from the seeing the true price when they pick out a hotel and by limiting their ability to comparison shop. Over the past decade, a growing number of hotels have imposed these fees on consumers, which can be $50 or more per night. More than one-third of hotel guests report having paid such fees. And the total costs for Americans are enormous: according to one report, hotels collected billions in these fees and surcharges in 2018.

The President urges Congress to ban these surprise fees by requiring that hotels include them in the price of the room, so consumers aren’t surprised. Travelers should know which hotels charge these fees and which ones do not, so that they can plan and budget accordingly.

The President is calling for passage of a Junk Fee Prevention Act to provide millions of Americans with fast relief from these frustrating and costly fees. This will not only save Americans billions a year, but make our markets more competitive—creating a more even playing field so that businesses that price in a fair and transparent manner no longer lose sales to companies that disguise their actual prices with hidden fees. In the coming weeks and months, the Biden-Harris Administration looks forward to working with Congress to crack down not only on these fees, but also other junk fees that take cash out of Americans’ pockets and hide the true cost of products.

$600 Million in Refunds Returned to Airline Passengers Under DOT Rules Backed by New Enforcement Actions

Frontier Airlines was one of the airlines fined by the US Department of Transportation for extreme delays in providing refunds to passengers © Karen Rubin/news-photos-features.com

The U.S. Department of Transportation (DOT) announced historic enforcement actions against six airlines, which collectively paid $600 million to people who were owed a refund due to a canceled or significantly changed flight. These fines are part of DOT’s ongoing work to ensure Americans receive the refunds they are owed from airlines. Since the beginning of the COVID-19 pandemic, DOT has received a flood of complaints from air travelers about airlines’ failures to provide timely refunds after they had their flights canceled or significantly changed. 

“When a flight gets canceled, passengers seeking refunds should be paid back promptly. Whenever that doesn’t happen, we will act to hold airlines accountable on behalf of American travelers and get passengers their money back.” said U.S. Transportation Secretary Pete Buttigieg. “A flight cancellation is frustrating enough, and you shouldn’t also have to haggle or wait months to get your refund.” 

In addition to the more than $600 million in refunds airlines have paid back, the Department announced today that it is assessing more than $7.25 million in civil penalties against six airlines for extreme delays in providing refunds. With today’s fines, the Department’s Office of Aviation Consumer Protection has assessed $8.1 million in civil penalties in 2022, the largest amount ever issued in a single year by that office. A majority of the assessed fines will be collected in the form of payments to the Treasury Department, with the remainder credited on the basis of payments to passengers beyond the legal requirement. The Department’s efforts have helped lead to hundreds of thousands of passengers being provided with more than half a billion dollars in required refunds. The Department expects to issue additional orders assessing civil penalties for consumer protection violations this calendar year. 

The fines assessed today and required refunds provided are: 

  • Frontier – $222 million in required refunds paid and a $2.2 million penalty 
  • Air India – $121.5 million in required refunds paid and a $1.4 million penalty 
  • TAP Portugal – $126.5 million in required refunds paid and a $1.1 million penalty 
  • Aeromexico – $13.6 million in required refunds paid and a $900,000 penalty 
  • El Al – $61.9 million in required refunds paid and a $900,000 penalty 
  • Avianca – $76.8 million in required refunds paid and a $750,000 penalty 

All of the consent orders are available at www.regulations.gov, docket number DOT-OST-2022-0001. 

Under U.S. law, airlines and ticket agents have a legal obligation to refund consumers if the airline cancels or significantly changes a flight to, from and within the United States, and the passenger does not wish to accept the alternative offered. It is unlawful for an airline to refuse refunds and instead provide vouchers to such consumers.  

The fines announced today are one of the many steps the Department is taking to protect consumers. Below are additional actions DOT has taken: 

  • During the summer, the Department rolled out a new airline customer service dashboard to help consumers determine what they are owed when a flight is cancelled or delayed because of an airline issue. Previously, none of the 10 largest U.S. airlines guaranteed meals or hotels when a delay or cancellation was within the airlines’ control, and only one offered free rebooking. However, after Secretary Buttigieg called on airlines to improve their service and created this dashboard, nine airlines now guarantee meals and hotels when an airline issue causes a cancellation or delay and all 10 guarantee free rebooking. The Department will continue to work to increase transparency so Americans know exactly what the airlines are providing when they have a cancellation or delay. 
     
  • The Department’s proposed rule on Airline Ticket Refunds, if adopted, would: 1) require airlines to proactively inform passengers that they have a right to receive a refund when a flight is canceled or significantly changed, and 2) define a significant change and cancellation that would entitle a consumer to a refund. The rule would also 3) require airlines to provide non-expiring vouchers or travel credits when people can’t travel because they have COVID-19 or other communicable diseases; and 4) require airlines that receive significant government assistance in the future related to a pandemic to issue refunds instead of non-expiring travel credits or vouchers when passengers are unable or advised not to travel because of a serious communicable disease. The Department invites the public to submit comment on this rulemaking by December 16, 2022. The Department’s Aviation Consumer Protection Advisory Committee will publicly deliberate on the Department’s proposed rule on Airline Ticket Refunds and decide on recommendations to make to the Department at a virtual meeting on December 9, 2022. To register and attend this virtual meeting, please use the link: https://usdot.zoomgov.com/webinar/register/WN_V2zwVF3RQfuoOkyYFVqvdA
     
  • The Department has proposed a rule that would significantly strengthen protections for consumers by ensuring that they have access to certain fee information before they purchase their airline tickets. Under the proposed rule, airlines and travel search websites would have to disclose upfront – the first time an airfare is displayed – any fees charged to sit with your child, for changing or cancelling your flight, and for checked or carry-on baggage. The proposal seeks to provide customers the information they need to choose the best deal. Otherwise, surprise fees can add up quickly and overcome what may look at first to be a cheap fare. DOT encourages members of the public and interested parties to submit comments by December 19, 2022. 

The Department has proposed a rule to refund passengers for services they paid for that aren’t actually provided (e.g., broken WiFi). 

For information about airline passenger rights, as well as DOT’s rules, guidance, and orders, the Department’s aviation consumer website can be found at: https://www.transportation.gov/airconsumer