Are lax rules slowing down airline ticket refunds?

Kathleen and Eugene Bianucci paid $5,770 for a pair of round-trip tickets between San Francisco and Dublin this year on Virgin Atlantic Airways. A few days before their trip, Kathleen, a fitness instructor from San Bruno, Calif., broke her leg and had to be hospitalized for a week. Her doctor grounded her for six months, and when she told the airline about the accident, a representative promised her a full refund.
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Ridiculous or not? Airlines fall in love with fuel surcharges all over again

When Sylvia Dawson tried to book airline tickets from New York to London for a group traveling next month, she was taken aback by the fare.

“We were told by Virgin Atlantic that there would be a fuel surcharge of $98 per person,” she says.

Dawson isn’t a novice who would be shocked by news like that. She’s a travel agent who specializes in tours to England, and books a lot of flights over the pond. The reservation was for a group of 20 clients headed to the U.K. on a tour.

“We know that the price of oil has skyrocketed,” she says. “But this group has been booked with Virgin since the beginning of the year. It seems that the increase is somewhat over the top.”

Worse, her group couldn’t pull out of the trip without incurring heavy penalties. The airline had them over a barrel, figuratively speaking. Either they would pay 14 percent more for the price of their tickets or lose their vacations.

Fuel surcharges are a peculiar thing. On domestic flights, the price of fuel must be included in the base fare quoted to passengers. But international flights aren’t regulated the same way, and an airline can quote a low base fare but then add a “fuel surcharge” later.

Is Virgin Atlantic out of line?
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Strike update: Virgin Atlantic deploys larger aircraft to accommodate stranded air travelers

virgin2You knew this would happen.

Virgin Atlantic Airways just announced it would deploy larger aircraft on key routes over the 12 days of the planned British Airways cabin crew strike “in order to carry stranded passengers.”

Virgin Atlantic has identified a number of flights on routes such as New York (Newark), Boston, Washington and Delhi where it is feasible to operate the flights with larger aircraft. These selected flights will now be operated by an Airbus A340-600 rather than an A340-300, thereby providing 68 extra seats per flight. The extra seats will go on sale over the next 24 hours.

British Airways and Virgin Atlantic are bitter rivals, of course. Which makes the following quote from Virgin’s Richard Branson so — well, let me just play the clip for you:

It is a nightmare for passengers, and you have to feel for them at Christmas time. Any strike would obviously be extremely damaging to everybody – the company, employees and most importantly the traveling public.

But a good PR opportunity for Virgin Atlantic. Why else would you issue a news release on this? (Actually, let me rephrase: What took you so long?)

Meanwhile, British Airways has bigger fish to fry. It’s going after its own employees.
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“Should I just take the money and run?”

virginatlanticMegan Boing booked two tickets from Chicago to London on Virgin Atlantic Airways for her honeymoon. Then the airline canceled her flights.

Normally, it would offer her two options: either a full refund or a new flight of its choosing.

But that’s not what happened.
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Has Virgin Atlantic deflowered EU Rule 261?

The European Union has some of the toughest passenger rights laws on the books. But is Virgin Atlantic thumbing its nose at the rules?

EU Rule 261 says delayed passengers must be compensated a minimum of €250, and a recent court decision says airlines may not use a mechanical delay loophole to get out of their obligation. Yet that is precisely what happened to Adam Giusti, who was flying from Newark to London on Dec. 26.

When we arrived at the airport to check-in, we were told that one of the planes engine’s had failed and we would not leave for London that night. The replacement part for the plane was brought in from another airport that night and the engine was repaired. Our departure was delayed until the next day. Virgin Atlantic put us up in a hotel for the night. Upon speaking with a Virgin Atlantic representative at EWR the next morning, she assured us that we would be able to recoup damages.

Under Article 6 of the rule (PDF) Giusti is entitled to €600.

Virgin Atlantic disagreed. It sent him a letter offering 5,000 frequent flier miles, instead.

I suggested he appeal to the airline, citing the EU rule and the recent court ruling, which clearly outlined Virgin Atlantic’s responsibility. Its answer?

Virgin Atlantic has been made aware of, and are looking into the latest EU ruling on Regulation 261/04. We know that this specifically constitutes an “unexpected flight safety shortcoming” for the purpose of the exemption from compensating passengers in the event of a flight disruption. In the meantime, however, our position remains unchanged.

Any attempt to operate aircraft with known technical faults would create a flight safety shortcoming. And thereby compromise the non-negotiable basics of flight safety and security, which must be upheld by all European Union airlines. Where flight safety shortcomings are unexpected, the airline is exempt from the requirement to pay compensation.

Interestingly, this appears to be a pattern. I asked Virgin Atlantic to review an almost-identical case last week from reader Damon Anyos and it came back with an almost-identical response.

Anyos’ flight from Chicago to London was canceled for mechanical reasons. Although the airline paid for his hotel and meals, it denied his request for €600 under EU Rule 261.

According to our customer service records, Mr. Anyos was compensated appropriately as per the EU Mandated Compensation 261/2004.

Under such regulation, if Virgin Atlantic has to cancel a flight due to circumstances beyond our control and within 14 days of departure as a result of the following: operational, industrial action, political instability, weather, aircraft type grounding, air traffic control or safety reasons (technical would fall under safety), then we are not required to offer financial compensation.

We are required to rebook them on the next available flight and offer ‘care’ (which would be to pay for hotel and meals if it’s an overnight delay) which in this case we did provide.

Under EU, Virgin Atlantic isn’t obligated to offer any good will gestures, such as miles, yet due to our high level of customer care, we offered 25,000 miles as a further apology.

Indeed, Virgin seems to offer a different interpretation of its responsibility under EU rules than the EU court appears to have intended it to.

I can’t blame Virgin for its narrow take on EU Rule 261. But is it correct?

I’m not a lawyer, but I can’t imagine lawmakers intended to let airlines off the hook for a mechanical delay. If they had, then they might as well have not written it. The subsequent EU court rulings support that conclusion.

Maybe this will be an issue the courts — not the customer service agents — must decide.