The Biden Administration will shortly propose a new rule that requires prompt passenger fee refunds in cases of delayed baggage, inoperative Wi-Fi, and other services lapses.
Biden Administration Will Require Airlines To Promptly Refund Passenger Fees
During a Friday briefing, Brian Deese, the White House National Economic Council Director outlined a plan to require fee refunds for baggage that is significantly delayed. Deese said the move is “part of a broader effort that the president will release shortly around driving greater competition in the economy in service of lower prices.”
Current rules require refunds only if baggage is lost plus compensation for “reasonable” expenses. Under the new proposed rule, airlines must refund baggage fees if baggage does not arrive within 12 hours of a domestic flight landing or 25 hours after an international flight lands.
Airlines would also be forced to refund wi-fi fees when wireless onboard internet does not work.
The rule would be enacted by via Executive Order from President Biden.
In 2019, airline generated $5.76 billion in checked baggage fees. Although that number dropped by half last year, it is expected to rise again this year as consumers return to the skies.
Is This Necessary?
Interestingly, there does not appear to be data on how often airlines refund baggage fees when luggage is lost. While I do not have any experience with claiming back luggage fees, I have successfully claimed wi-fi fees on numerous occasions on United when I paid for wi-fi and it did not work. My understanding is that other airlines also promptly refund this fee upon request and sometimes even proactively.
While I don’t see this regulation as unnecessarily burdensome and support in on the basis of consumer protection, I have not heard from readers that it is even an issue.
What is an issue–and what I hope will be remedied–is the deceitful resort fee add-ons at hotels. This used to be a Las Vegas problem but is now a nationwide issue. Consumers are misled into deceptively low pricing only to find additional fees that sometimes can nearly double the overall cost of the hotel room.
As much as I detest those fees, the main problem is not the fees themselves, but the lack of initial disclosure. I hope that will be remedied soon.
Airlines frequently show that they cannot be trusted to do the right thing. While such regulation should not be necessary (and in fact is not necessary in many cases), having a standard rule on the books will promote transparency and consumer confidence. Airlines should not complain and instead simply focus on delivering functional wi-fi and baggage on-time.