Government to airlines: Put it in the contract!

By | June 8th, 2010

Editor’s note: This is part four in a series of posts about the Transportation Department’s sweeping new airline passenger protection rules. Please take a moment to comment on these proposed rules at Regulationroom.org. The future of air travel depends on it.

Talk is cheap.

That’s the gist of the part of the latest government rulemaking that is likely to give airlines the biggest headache. Instead of just “strongly encouraging” the airlines to adopt customer service plans, the government wants them to put it in their contracts of carriage, the legal agreement between them and their customers.

It’s about time.

The government first proposed this requirement in 2008. Ultimately, the DOT decided against it, and for reasons that aren’t entirely clear, and instead encouraged carriers to voluntarily incorporate the terms of their tarmac delay contingency plans in their contracts of carriage, as most major carriers had already done with respect to their customer service plans.

At the time, the department required that each U.S. carrier with a website post its entire contract of carriage on its website in easily accessible form, including all updates to its contract of carriage. The government also indicated that it would address this issue in a future rulemaking and take into account, among other things, whether the voluntary incorporation of contingency plan terms had resulted in sufficient protections for air travelers.

Well, it didn’t work. According to the rulemaking,


As it appears that many carriers are choosing not to place their contingency plans and/or customer service plans in their contracts of carriage, or have little incentive to do so, and because we believe the incorporation of airline contingency plans in contracts of carriage to be in the public interest, we are again proposing the implementation of this requirement.

This requirement would also extend to foreign carriers operating in the United States, eliminating yet another loophole that many air carriers took full advantage of. The government is doing what it should have done years ago — requiring airlines put their own customer service rules in writing.

Related story:   Who has the worst contract in travel?

Will any of this raise airfares? Unlikely.

According to the preliminary regulatory analysis (PDF), it’s really anyone’s guess how this will affect airlines financially.

A February 2010 review of the websites of reporting U.S. carriers that sell air transportation to the general public indicated that all have posted their CSPs, either on a stand-alone basis or as part of their contracts of carriage on their websites.

However, we did not attempt to determine whether or not any carriers posted tarmac contingency plans or incorporated them into their contracts of carriage in advance of the April 2010 effective date for the requirements for these plans included in the Final Rule.

Maybe it’s not even worth asking the question: Will this rule cost too much? That’s probably because it’s just the right thing to do.

The Rulemaking Series

I’ve written this series of posts in order to help you understand the Transportation Department’s proposed rules and offer the most informed feedback during its commenting period. Please take a moment to read them and then tell the government what you think at Regulationroom.org.