Air Canada Earns the Cranky Jackass Award For Continuing to Avoid Refunds

Air Canada, Cranky Jackass
Cranky Jackass

I thought this had been settled some time ago, but in Canada, the war continues. After airlines started playing games during the pandemic, the Department of Transportation (DOT) told airlines if they couldn’t deliver something close to what the traveler purchased, they had to give a refund. This message is apparently still sitting in customs in Canada, because the Canadian airlines didn’t get the memo. Canadian carriers have continued to refuse any refunds due to schedule changes, and they’ve even told DOT that’s their stance. Today, we rip into Air Canada, an airline that has unquestionably earned the Cranky Jackass Award for blatantly ignoring the rules.

Though most people who are angry with airlines file their complaints directly with DOT’s Air Consumer website, some have taken to filing dockets that the public can see, and the complaints against Air Canada have been piling up. Air Canada’s initial responses were regarding people who lived and purchased tickets outside of the US even if travel involved the US. Air Canada used the fact that these people were outside the US to say DOT rules shouldn’t apply. (Spoiler alert: that’s not true.) But I waited until we had an American get denied by Air Canada before writing this post. I figured it would make Air Canada’s unreasonable position harder to justify. And now, I present to you the case of Naomi Horovitz.

Cranky Jackass

In the complaint which Naomi filed in the docket on June 5, she tells a familiar tale. On March 5, she bought three tickets on Air Canada. One was for herself roundtrip from Chicago to Vancouver. The others were for her husband and daughter from Phoenix to Vancouver and back to Chicago. Travel was to begin on May 23. On April 2, Air Canada canceled her flight, and she asked for a refund. Air Canada said no, so she filed this complaint.

After asking for an extension to gather its thoughts, Air Canada came roaring back on July 6. The airline says the complaint should be dismissed outright by DOT, and it gave three reasons that should happen.

  1. Air Canada says its refusal to refund complies with its Conditions of Carriage, its International Tariff, fare rules, and regulations in Canada.
  2. Air Canada says that DOT’s enforcement document on refunds was just a “guidance” document and does not “have the effect of law.”
  3. Air Canada says its refund policy (or no-refund policy) is not deceptive nor unfair under DOT rules.

That is quite the argument, and it’s hard to believe that this was what the airline actually put forth.

Air Canada puts a great deal of weight into the fact that this cancellation was out of its control, and that seems fair. It didn’t create the pandemic, and the drop in demand certainly was beyond its control. But then it stretches this too far. Air Canada says it was “forced” to cancel flights so it could focus on repatriation, but that’s not true. It seems highly unlikely that it couldn’t have put some aircraft on the Chicago to Vancouver route that day. It just knew that there was no demand, so it canceled. And since it couldn’t even offer a reasonable alternative, you’d think it would have to give the money back.

Instead, Air Canada says that it was because of this focus on repatriation that it had to scale back its so-called “goodwill” policies. And then suggests that it was just an incredibly benevolent company that had no choice.

Certain customers with reservations for flights that were cancelled due to events outside of Air Canada’s control (including COVID-19) before March 19, 2020 may, as a goodwill gesture, have generously been offered a refund despite having booked reservations at a non-refundable fare.

Air Canada says this was never required, but it was doing it out of the kindness of its maple syrup-filled heart. It seems absurd to suggest that an airline can publish a policy and then renege on it. In fact, some might say it’s deceptive since this was changed to deny to refunds on changes after March 19 regardless of when the ticket was purchased.

Not only does Air Canada dispute that, but it includes a veiled threat in its response.

Determining that later scaling back on these goodwill policies constitutes an unfair or deceptive practice would interfere with carriers’ valid contracts, and would disincentivize carriers from ever providing customers more than the very minimum level of flexibility guaranteed in their Conditions of Carriage.

In other words, if you make us do things that we said we’re going to do, we’re never going to do them unless they are in the barebones requirements of the contract of carriage. Or in summary, “Don’t push us, DOT, or you’ll regret it.”

Air Canada then uses the time-honored tradition of citing mom when dad won’t cooperate. In effect, it says that Canada says it’s ok, so the US should just abide by that.

It’s hard to fathom how this whole thing isn’t unfair and deceptive, as Air Canada claims. Air Canada had publicly published a policy saying it would give refunds for major schedule changes. That was in place when the ticket was bought, and so it seems fair to assume travelers would expect that to apply.

United tried the same thing when it switched its schedule change rules midstream, and DOT told them they couldn’t do it. Now United is back to where it was previously. Air Canada,however, thinks since it isn’t a US-based airline it can get away with completely ignoring DOT rules.

The reality should be pretty simple, but Air Canada is pulling out every trick in the book to refuse a refund. It’s painful to watch, and for this, Air Canada most certainly deserves the Cranky Jackass Award.

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47 comments on “Air Canada Earns the Cranky Jackass Award For Continuing to Avoid Refunds

  1. Airline management — the people setting these policies, not the front line workers handling the calls from these frustrated customers and enforcing the policies — are so unempathetic. They fly for free, have never paid a change fee or requested a refund, believe that there’s a endless line of customers willing to step up and buy so screw the customer in front of them.

    1. If I led a business, I’d make a point of requiring top management to spend at least a day every quarter working “on the front lines”, particularly in customer service roles but also in operations / manufacturing roles as well. Too many businesses are run by managers (or the stereotypical MBA types) who rarely leave the comfort of their ivory towers, with the result that their decisions and policies are not always in touch with reality.

      1. Kilroy

        One of my customers ( a credit card company) in the 1990’s did that.

        The CEO mandated that everyone (including himself) would spend 4 hours a month in one of their call centers taking customer calls.

        He felt that it was a very tangible way to get close to your customers and to really understand what they need and to be able to quickly respond to them.

        They monitored compliance and you had to have a valid excuse if you missed your 4 hours on the phones.

        If the airlines would implement something like that, Cranky might be able to retire his Jackass Award! :)

        1. Keith,

          Exactly. For a service business and a customer-focused business, this type of a practice really drives home the importance of knowing and understanding your customers and their needs. It’s also a great form of cross-training, helping to make teams more flexible and allow the company to respond to “all hands on deck” situations where demand/calls spike.

          This practice also makes management easier to relate to the rank and file, opening up avenues of informal communication and reducing the divide between departments and groups. So many great ideas in companies languish because they don’t get into the hands of people who can recognize them and provide the resources to implement them.

          Businesses where the original founder is still involved often have sometimes have this type of customer focus and similar practices baked into them by default (founder/owner typically succeeded by identifying and responding to customers’ needs), but it tends to get lost as the original founder ages and their descendants and professional managers take more active roles in the company.

    2. Funny. If you think they treat their customers badly you should see how they treat their employees. AC can’t be trusted to treat anyone fairly and/or by the rule of law or policies they haven’t created themselves for their own benefit.

  2. CF,
    What power does the DOT have to enforce refunding passengers their money? Can they take away some of Air Canada slots in the US market?

    1. Angry Bob – Good question. I’m not sure what the remedies are if an airline refuses to comply. They probably have to take them to court? I really don’t know.

      1. Could they revoke Air Canada’s right to fly in U.S. airspace for not being able to follow DOT rules and regulations? As far as I’m aware, Canada is not a signatory to the International Air Services Transit Agreement which grants 1st and 2nd freedoms. Also, in the U.S.-Canada Open Skies Agreement, Article 4 is Revocation of Authorization, Section 1 . Either Party may revoke, suspend, limit or condition, the operating authorizations
        or technical permissions of an airline designated by the other Party where such airline fails to maintain its qualifications as required by the aeronautical authorities of that Party under the laws and regulations
        normally applied by those authorities.

  3. I know that this is potentially an international issue, and thus a bit more complex, but I keep waiting for an ambitious lawyer or state’s attorney general with a little time on their hands to attempt a class-action or consumer protection suit on airlines that do things like this. Whether you agree with that tactic or not, and whether it works or not, it would be a good way for someone to get themselves a lot of free publicity.

    1. AC should be given deadlines to first make arrangements then actually deliver refunds rightfully owed or else be blocked from operating in the USA.

  4. “Air Canada’s initial responses were regarding people who lived and purchased tickets outside of the US even if travel involved the US. Air Canada used the fact that these people were outside the US to say DOT rules shouldn’t apply. (Spoiler alert: that’s not true.)”

    I wanted to see if you could clarify the spoiler alert a bit. What regulations do airlines have to follow on international routes if the origin and destination countries have different and perhaps conflicting rules?

    In the case of EU 261/2004 rules EU carriers have to adhere to the compensation rules for every flight no matter the route while foreign (non-EU) carriers only have to adhere on flights from the EU (but not to the EU).

    So is the general rule derivable from this that foreign carriers have to follow US DOT rules for flights departing from US soil, but not for flights originating abroad?

    1. Oliver – The general rule is that if a flight touches a country on one end, then that country has some kind of jurisdiction. Different rules apply depending upon the regulations themselves. But in this case, DOT says its rules apply to any flight touching the US or any US airline even if flights are outside the US.

  5. Sorry but I don’t agree with this. This post should be removed.

    Everyone thinks the world revolves around them. If all airlines were to refund all passengers, they would go bankrupt. Can you imagine if there were no more airlines flying? How many countries rely on tourism as their #1 source of income? People in those hundreds of counties would literally die.

    A 24 month credit is more than enough time to travel again. People need to be considerate of others and not about nothing else but their own money! Grow up!

    1. People are entitled to their money refunded for services not provided as contacted. Simple rule of law and commerce

      Dick Streim

    2. Decline- 24 months may seem like a long time but with the current pandemic and the idiots who refuse to wear masks & the continued spread of Covid-19 we may not be able to travel safely. I hope its over in a year but what if it isn’t? We shld all be screwed out of our money?? It’s easy for u to comment bcuz your not one of the victims. Try walking a mile in my shoes where $3000 cld be going back to my household savings until this pandemic is over. Also I read that Air Canada was willing to gv refunds to some countries to adhere to EU Guidelines which are the same as the DOT’s. You can’t offer refunds to some and not others. The issue is, Air Canada makes more money off of flights that have to do w/the U.S. than other countries. So they wld lose more money w/ refunds for U.S. flights. My flight was roundtrip frm FL to Canada & Canada to Italy and back after a 5 day cruise. The cruiseline gv me a full refund. I was willing to take a voucher for the international half of the flight since Italy was in lockdown if they just refunded the roundtrip FL to Canada/ Canada to FL flights, but they refused.

    3. You say twenty four months is enough to use a travel voucher but the one in a life time cruise that my husband and I were scheduled to go on in Alaska departing from Vancouver is not going to happen in the next 24 months secondary to Corona virus concerns so we now have no need to go to Canada . We are going to have take an alternative cruise that does not involve starting in Canada so would very much appreciate an option of a refund as offered by other carriers.

  6. DOT should just go nuclear and say, “You don’t want to follow our rules, don’t fly here!” and block the airline from the US until it falls in line. Then we’ll see how stiff Air Canada’s spine really is…

    …and I say this as someone who genuinely likes flying with Air Canada but this it grade school playground level BS and well deserving of the Cranky Jackass award…

  7. New revenue concept for Air Canada:
    Publish schedule with thousands of flights.
    Sell tickets.
    Cancel flights.
    No refunds.
    Brilliant!

    1. That’s exactly what Air Canada is doing right now. With a mandatory 14 day quarantine and the border closed to all but essential travelers, no one is flying into Canada yet AC is selling all kinds of flights it will never operate. Only a fool would buy a ticket on AC. If you really need to fly AC, buy it through a codeshare with United.

  8. I bought a round trip International ticket through Expedia with Air Canada on Feb 29. Travel started In Baltimore, transited Montreal and Brussels to arrive in Douala, Cameroon. The terms of purchase included refund of the cost– less a $300 US cancellation fee. I was notified on April 9 that my flights were being cancelled by the airlines due to COVID19. I have sent numerous emails and spent hours on chat with Expedia and Air Canada. I have complained to DOT.

    As of July 9, I have been refunded ZERO dollars. This is robbery. I paid for travel. Terms of purchase were NOT honored. Never, never, buy a ticket from Air Canada or Expedia

  9. We were booked on Lufthansa to fly Vancouver to Dubai in late February. LH cancelled their flight and then Dubai airport closed completely to all flights. Five months later, we still haven’t got our refund from LH. So AC is not unique. My guess is they simply haven’t got the money to meet all refund requests. The Canadian government has some program to help meet payroll but that will run out and AC will then fire 20,000 employees that they no longer need. In the meantime, would the Canadian taxpayer be happy for their hard-earned to be used for refunding rather than preserving jobs? Refunding Americans? (Don’t answer that!) The German government has bailed out Lufthansa at a cost of billions of euros. My understanding is that AC is hoping to get through this without being bailed out by the government. Like all airlines, they are burning through millions of dollars a day. If they were refunding as well, how long could this go on? You can quote all the legislation you like but it was never designed for this situation. Will I ever get my refund from LH? Ever?

  10. I got the same response from Air Canada as you mentioned…here is their email to me (I subsequently filed a complaint with DOT and filed a credit card dispute and prevailed with the dispute!)

    Dear Mr. Schlichter,

    Thank you for your email regarding your unused tickets. I hope that you and your family are all safe and healthy during these difficult times.

    These are unprecedented times globally, and particularly for the airline industry which is experiencing the most profound crisis in its history. In response, airlines have changed everything about how they operate, from massive workforce reductions, and the grounding of entire fleets, to changes in the products and services customers have come to expect.

    We realize that COVID-19 has disrupted the plans of travellers worldwide, and our priority is to ensure that our customers have options with a flexible rebooking policy. Similarly to other major airlines, Air Canada is offering all of our customers whose travel was cancelled due to the COVID-19 crisis, including those with non-refundable tickets, the option to keep the remaining value of the ticket for future travel with no expiry date.

    Our policy of offering the remaining value of the ticket for future travel is not only consistent with how major airlines are managing this unique situation, but it is also in line with our publicly published tariff rules. Our policy states that in the case of uncontrollable cancellations, the airline’s responsibility is to provide alternate travel options (as opposed to refunds), at the end of the event that caused the cancellation.

    This is also consistent with the Canadian Transportation Agency, which recently confirmed in a statement regarding COVID-19, the appropriateness of offering the remaining value of the ticket for future travel due to this unprecedented situation. This statement can be found here:

    https://otc-cta.gc.ca/eng/statement-vouchers

    Air Canada is currently working on a self serve option that allows customers to exchange the remaining value of their ticket, but unfortunately it is not ready yet. If you want to make a booking before the self serve option is available, I can create a voucher for you but it will expire in 24 months. Otherwise we appreciate your patience while we finalize this for you.

    Customers with refundable tickets who prefer to receive a refund can do so. However, the usual fare rules apply, which means that a portion of the fare may be non-refundable. Should you have a refundable ticket, please have your booking agent contact us or visit http://www.aircanada.com and click on the ‘My Bookings’ tab to process the refund.

    Once again, we apologize for any inconvenience that this has caused, and we thank you for your understanding.

    Sincerely,
    Catriona Hutchence
    Customer Relations

    Air Canada

    To serve you best, I kindly ask that you do not change the subject line if responding to this email.

    1. That’s actually never than the email I received. I had purchased 4 round trip tickets to Beijing scheduled to leave March 29. Obviously the flight was cancelled. When I specifically asked about a refund I was told no refunds were being offered and that was consistent with the airlines policy. And then given the link that you received above. They also told me the airline credit would expire in 12 months. That’s it! It’s absolutely ridiculous! They wouldn’t even tell me the exact amount of the credit. Said I had to call customer service to find out that info. You know….the number that won’t even let you hold to speak to a real person and tells you to call back 24 hours within your scheduled travel (and then the wait time is up to 5 hours). Purchased the tickets in September so I can’t even dispute the charges with my credit card company.

      1. Be sure to file a complaint with the DOT and try disputing your credit card since the failure of service just happened. You have nothing to lose. I would also sue them in small claims court myself!

  11. One has to admit though…Air Canada has some pretty big cajones to hold on to people’s money after failing to deliver, and then take the nuclear option of trying to defend that stance…

    When you’re this morally and ethically bankrupt, the looming financial downward spiral is only a matter of when, not if.

  12. That award is perfect for them. I finally gave in & agreed to the voucher as my flight was originally planned for today and I was scared that if I didn’t commit to the voucher that I wld lose out on my $3,048 I paid for airline tickets for my family of 4. Except their vouchers are only good for 2 yrs, I thought they changed it so the vouchers wldn’t expire?!?. They are the biggest Arses on the Planet! I had originally booked thru Citicard Travel. Since they are the credit card company as well they refused to do a chargeback & stated vouchers are only good for 24 months. They too nd a Jacka** award! I will NEVER use Air Canada again once I redeem my voucher. Worst company EVER!

  13. AC has US bank accounts, both to collect payments from US pax and to pay AC’s US employees and vendors.

    I doubt the money in AC’s US bank accounts would cover the refunds owed to American pax, but freezing AC’s bank accounts (or having the DOT garnish them, or put a bank levy on them for an estimate of the amount owed to American pax) would certainly get AC’s attention. The resulting media attention (both from the action and from AC being unable to pay their US employees and vendors) would be worth a few bowls of popcorn to watch. (As would the diplomatic conflict between the US and Canada that such an action would likely start, with retaliatory moves directed at US airlines, but that’s another story.)

    If I were a passenger owed a refund by AC, I’d be looking to do a chargeback with my credit card company for services not delivered or refunded as required by law, along with filing a complaint to the US DOT (with copies and repeated calls to the staffers of the Congresspeople who represent my district, as well as the office of my state’s attorney general, asking them for help). If that didn’t work, small claims court is cheap and might also be worth a shot.

  14. While I see little or no excuse for what Air Canada is doing, doesn’t Naomi, and everyone else in her predicament, have a remedy though her Credit Card company?

    1. bgaggs – There have been many reports of people trying to dispute and getting turned down. I can’t say I know exactly why.

      1. Naomi here (and thanks for covering my case!). I initiated a dispute with Chase Bank and they gave me a temporary 90-day credit. Then Air Canada responded with their usual nonsense about how it was a non-refundable ticket, and Chase sided with them and reinstated the charges. That’s when I initiated my formal complaint with DOT (and FWIW, I submitted an informal complaint too, but nobody responded). I’m just happy that this is now getting some people’s attention. I hope I don’t have to go to small claims court, but I guess that would be my next step.

  15. I think I just got a preview of my response from my formal DOT complaint against Air Canada, which is due tomorrow. We need the DOT to push back just like the EU is doing.

  16. Here is my story. This is a perfect bait and switch. They posted the route from NY LGA to Toronto to Seoul round trip at $855 for Aug 16 departure. 4 days after my purchase on July 2nd they canceled the flight from Toronto to Seoul and made an extra stop at Vancouver, prolonging my flight for more than 30 hours and commenting there is a risk of missing the connect flights. I did not want this 2 stops to Seoul and asked for the refund but only options were airline mileage or travel voucher. I hardly use Air Canada and I don’t know when I will use that airline again. I’ve been complaining thru customer service, email, and Twitter. Their response was horrible saying I can give that voucher to someone else and it has no expiration date. This is not something I booked before the pandemic. They knew exactly what they are doing. What can be done together to punish their behaviour?

  17. @Cranky whats your take on Canadian airlines not receiving any bailout compared to US airlines (genuinely curious as I feel that adds another dimension to this that isn’t well covered as is)? You say that this should be pretty simple but I think it’s a bit more complex than that right now. Instead of giving a bailout for refunds, as the US government has done, the Canadian government hasn’t offered any bailouts and instead indicated that Canadian airlines can hold onto passengers money as a “loan” https://www.tricitynews.com/canadian-airlines-not-required-to-offer-full-refunds-for-cancelled-flights-1.24143417.

    I agree the bait and switch isn’t ideal but I’d be hard pressed at coming up with a better solution (AC has some of the most generous voucher and Aeroplan mile refund policies right now) given the current situation.

  18. Take a look at the record of Hawaiian in this whole mess. Their actions are at least egregious as Air Canada’s. Blatantly ignoring DOT rules on refunds for cancelled flights, defiantly insisting that re-accommodations trumped cancelled flights, etc. took months of wrangling with them, DOT and BBB complaints, numerous social media posts and endless hours on the phone and “chats” (including an agent in their Philippine call center telling me that since the Reservations center was in the Philippines, DOT rules didn’t apply).

      1. Respect your guys right to take on whomever you please, but the fact remains that their attitude and actions have been far and away the most egregious of the U.S. carriers.  Shameful and just too bad they haven’t been held accountable.  In addition to a long litany of offenses I won’t bore you with, still waiting over a month for them to correct an $80 mistake they made on a refund they finally reluctantly said they would make.  Everybody else in the media on all sides have their favorites, so I guess you guys are entitled to the same.

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