In the fading days of President Biden’s time in office, his administration introduced a proposed rulemaking that would have given air travelers previously unheard rights, including forcing airlines to offer free rebooking, meals, hotel rooms, and even cash compensation for passengers facing a significant delay or canceled flight.
The rulemaking would have mimicked similar schemes, and the European Union, where airlines have to pay guaranteed cash compensation of up to $697 when the delay or cancellation is within their control.
Even when airlines don’t have any control over the delay, say when severe weather grinds air travel to a halt or the FAA-mandated flight cuts during the government shutdown, airlines in Europe are still required to look after stranded passengers.
It’s probably little surprise to learn that the airline industry was fundamentally opposed to the Department of Transportation’s rulemaking, with key industry figures, including the International Air Transportation Association (IATA), warning that the rules would have massively increased costs.
By some estimates, a generous EU or Canadian-style air passenger rights bill would have cost the US airline industry up to $5 billion every single year. Those costs, the industry warned, would inevitably have been passed on to consumers in the form of higher fares.
Even more worryingly, however, lobby groups like Airlines for America warned that giving passengers more rights might risk their safety because it would shift operational incentives, with airlines encouraged to dispatch flights in circumstances that, nowadays, they might think twice about.
Given that the rulemaking was introduced just a month or so before President Trump was due to take office, it always seemed incredibly unlikely that the rules would ever become reality.
It’s taken more than a few months to learn the fate of this rulemaking, but on Friday, the federal government released an as-yet-officially published docket in the Federal Register that withdraws the proposed rulemaking.
The DOT has decided to kill off the air passenger rights bill based on two executive orders signed by President Trump that direct the federal government “to identify and to repeal or to modify regulations that are unlawful or unauthorized.”
Officials believe that the airline industry already has strong incentives to look after passengers, and voluntary measures adopted by many airlines show that the current system is working just fine.
All 10 of the largest US airlines currently provide free refreshments and meals for passengers stranded during a long delay, while 9 out of those 10 also provide free accommodation and transport to passengers stuck overnight.
Meanwhile, officials say they could find no evidence to support claims that requiring airlines to provide cash compensation actually improves operational efficiency or reduces delays and cancellations.
Could you still get cash compensation when flying with a US airline?
If you are flying with a US airline to Canada or any country in the European Union, then you may still be entitled to cash compensation for a delayed or canceled flight.
The rules differ slightly between Canada and the EU, but if you suffer an eligible delay, the rules apply no matter the nationality of the airline you are flying.
In Canada, you could be eligible for cash compensation if the delay is fully within the control of the airline (like a commercial decision to consolidate flights due to low demand), while flights to and from the EU are covered with the exception of an ‘extraordinary circumstance.’
What an ‘extraordinary circumstance’ is very often up for debate, but over the years, the courts have cleared up this meaning to a large extent. For example, mechanical problems or planned internal strikes are not an extraordinary circumstance, whereas severe weather and external strikes are.
