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On Nov. 8, the Minister of Transport released a statement indicating that federal support for Canada’s airline industry would be contingent on the airlines issuing refunds to customers whose flights were cancelled due to the COVID-19 pandemic.
Transport Minister Marc Garneau addressed the unprecedented challenges faced by the airline industry and the toll COVID-19 has taken on its operations. As part of the proposed federal aid package, Garneau notes that the government will develop a process with major airlines to provide financial assistance such as loans.
According to Garneau, he expects discussions with the major airlines to begin this week.
Garneau: Financial Support Contingent on Customer Refunds
Garneau notes that airlines are not alone in being devastated by the COVID-19 pandemic. Canadian consumers who paid for airfare they could not use have also taken a financial hit that for which they were unprepared.
“When this unprecedented pandemic broke out in the spring, Canadians who had already booked travel ended up stuck with vouchers for trips they could not take instead of getting refunds,” Garneau said. “They found themselves in a situation where they have given thousands of dollars in interest-free loans to airlines.”
In addition to financial losses from tickets consumers paid for but cannot use, many Canadians are also suffering from the loss of air service to regional communities.
“The air sector cannot respond to these challenges on its own, given the unprecedented impacts on its operations,” Garneau said. “To protect Canadians, the Government of Canada is developing a package of assistance to Canadian airlines, airports and the aerospace sector.”
However, he notes that assistance to airlines will be contingent on their issuing customers refunds.
“Before we spend one penny of taxpayer money on airlines, we will ensure Canadians get their refunds,” he said.
“Any assistance the Government of Canada provides will come with strict conditions to protect Canadians and the public interest.”
COVID-19 Effects on Canada’s Airline Industry
The COVID-19 pandemic has taken an enormous toll on Canada’s commercial airlines. Passenger levels are reportedly down nearly 90% due to travel restrictions and fear of contracting the disease.
In response, airlines have furloughed hundreds of employees and discontinued dozens of regional flights since the World Health Organization declared COVID-19 a global pandemic in March.
Around the world, pre-booked airline flights were cancelled and many passengers were offered credits or vouchers instead of refunds for their cancelled flights.
The Canadian Transportation Agency has reportedly received thousands of complaints from mid-March through the end of August, most of which are likely related to refunds.
As of Oct. 26, 2020 the CTA was reportedly still processing complaints from before March 11 and had not even reached the cancelled flight refund complaints during the pandemic.
Canadian Airlines Facing Class Action Lawsuits Over Lack of Refunds
Many angry Canadians have filed class action lawsuits against airlines that have refused to provide refunds for cancelled flights. One plaintiff launched an airfare refund class action lawsuit against some of Canada’s largest airlines, including: Air Canada, Air Transat, Pacific Coastal Airlines Limited, Swoop Inc., and WestJet Airlines Ltd.
The plaintiff in this airfare refund class action lawsuit alleges the airlines breached the Air Passenger Protection Regulations governed by the Canadian Transportation Agency. He says he believed his only option was to cancel his planned flights and receive credits that he had to redeem within a limited period of time.
According to the COVID-19 refunds class action lawsuit, the APPR states that airlines should provide customers with clear terms in their contracts that simply and concisely inform customers what remedies they are entitled to in the event their flights are cancelled.
Last month, WestJet announced that it would provide refunds to some WestJet and Swoop customers who purchased tickets prior to the COVID-19 pandemic and whose flights were subsequently cancelled. The policy was supposed to take effect on Nov. 2.
COVID-19 Causes Widespread Disruption in Canada
The airline industry is not the only Canadian industry to suffer devastating effects from the COVID-19 pandemic. Many businesses have suffered losses due to governmental restrictions intended to slow the spread of COVID-19 that have reduced their capacity to do business. Restaurants, dental clinics, hotels, and other businesses have filed class action lawsuits against their insurance companies for failing to pay business interruption insurance claims that they believe they are entitled to receive due to the COVID-19 pandemic.
Employees have also fought back and filed lawsuits against employers who have allegedly failed to take adequate measures to protect their workers from COVID-19.
Did you have travel plans that were cancelled due to the COVID-19 pandemic? Were you able to get a refund from the airline? Tell us about it in the comments below.
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4 thoughts onAirlines Must Refund Canadian Customers to Receive Federal Support
My Family had a week vacation booked and purchased all inclusive cancellation insurance. March 16 departure. I cancelled on the 13th as per Government advisory. Apparently there’s a $4100 credit valid for 2 years that I had to go looking for as I have yet to be contacted by anyone from the airline. Nor have I received anything in the mail or by email.
2 years is almost up and its not looking good. Time to refund.
My family and I had booked a week in Mexico and when Air Canada cancelled all flights, we received a $6000 voucher, valid for 24 months. They should have refunded our money.
I had airline ticket to fly from Ottawa to Vancouver June 7, 2020 and returning June 14, 2020 baggage and seat were paid for as well no refund was given instead they offered only a voucher. Air Canada
I had plane tickets to fly to tampa florida from Halifax, NS for April 1, 2020 and returning April 30. 2020. They refused to reimburse me and said I had a credit valid for two years. Who is to say that within two years we will be returning to the United States, especially with the pandemic getting worse.