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U.S. air passengers don't have many rights when it comes to flying, but there are some rules in place to help protect consumers. George Hobica, founder of Airfarewatchdog.com (www.airfarewatchdog.com), joins host David Lytle for conversation about passenger rights, contracts of carriage and what rules you need to invoke to get compensation from the airlines. Hobica also discusses the benefits of government airline regulation, the differences between U.S. and European carriers, and how all passengers can benefit from consumer protection laws.

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Top Tips from This Podcast

See transcript below for links to more information.

  • Contracts of Carriage: Not all airlines have contracts of carriage at all. You can find each airline's contracts of carriage available for download at AirfareWatchdog.com.
  • Rule 240: Applies to American-based carriers on domestic flights. Invoke Rule 240 when their flight is delayed or canceled due to a problem that the airline is responsible for.
  • Rule 260: If your flight is delayed, or cancelled, so that your trip no longer makes sense.
  • Europe: Passenger Rights rules are more clear cut. They are government regulations that apply to all carriers operating flights within Europe.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

Announcer: Welcome to the Frommers.com Travel Podcast. For more information on planning your trip to any one of thousands of destinations, please visit www.frommers.com.
David Lytle: Hi. This is David Lytle, editorial director of Frommers.com. Today, we're talking with George Hobica, a regular guest on our podcast. He is the founder of Airfarewatchdog.com. Hi, George. How's it going?
George Hobica: David, good to be here. Thank you.
David: Good to have you back. We always enjoyed these sessions. Today, I'd like to talk about some of the posts that you've written on your blog on Airfare Watchdog, which you call Airfare WatchBlog.
George: Yes.
David: I'd like to talk about consumer rights, contracts of carriage. Explain what that is. What rights do consumers have? I think we should start, first, with an explanation of what is a contract of carriage, and how does that affect a traveler.
George: Sure. A contract of carriage isn't really a legal contract necessarily. They're somewhat hard to enforce. Before deregulation in 1978, I think it was the Civil Aeronautics Board or similar government agency actually had legislation that governed what happened if an airline passenger had a problem, say, with a missed connection or a cancellation or a delayed flight. But after deregulation, these rules were decommissioned.

And the thing is that a lot of airlines, because they're kind of slow to move, still have these contracts of carriage. In fact, they're the same rules that the government promulgated back in the '70s and before.

The rules are numbered: 100, 120, 160, 200, 240, 260, etc., and they govern a lot of things. But, the thing that I'm most interested in, and I think most passengers are, are what happens if something goes wrong with your flight that's within the airline's control--say, a mechanical problem or an engine falls off, like has happened on a South African plane recently. [laughs]
David: Right. [laughs] Yeah, just yesterday.
George: Right. Some airlines still have these rules in their contracts of carriage. They do follow them if you call the airlines on these rules--in other words, if you know what you're talking about and you say, "I'd like you to enforce this rule."

One of the rules that is most useful to passengers is Rule 240. Now, only the older airlines still have anything like a Rule 240. Southwest, Spirit, and Allegiance, some of the newer airlines, don't have these rules. What Rule 240 says, for a number of large, older airlines, is that if your airline cancels or delays your flight or you miss a connection, they will put you on another airline, if that other airline will get you there sooner than your original airline's next flight.
David: I'm sorry to interrupt. Does this have to be an airline that also has a similar contract of carriage, or is it any airline that is in the same airport?
George: Yeah, not necessarily. It can be any airline.
David: OK.
George: What happens is the original airline buys a seat for you, basically, or, in some cases, does a trade for a seat, for the credit, for passage on a second airline.
David: OK.
George: Some airlines, actually, will even put you in first class if that's all that's available. This has happened to me. I was coming from some place in the Caribbean, was connecting through San Juan on American Airlines, and my flight incoming to San Juan was delayed. My choice was either to spend the night in some flea bag hotel in San Juan, or perhaps on the airport floor, or I could invoke Rule 240--which is exactly what I did.

The American Airlines gate agent said, "I'm sorry. There's only one seat left on Continental to Newark, but it's a first class seat." And I said, "Well, according to your contract, you're supposed to give me that first class seat," which they did.

Now, unfortunately, that was a few years ago. Today, American Airlines is one of the airlines that's kind of gutted their Rule 240. They do have some language in their terms of service that says that, at their discretion, they'll put you on another airline, but there's no hard and fast rule.

Some airlines actually do have a pretty solid Rule 240 still on their books in their contract. One example is Northwest Airlines that has a Rule 240 that's little changed from the days of regulation. Also, United has one, and Delta has one. Some of the older airlines are good about this, and some aren't. Northwest specifically says they'll put you in first class if that's all that's available, but Delta, as far as I know, doesn't. Delta won't put you in first class, but they'll put you in coach on the next flight.
David: Do you have any statistics on how often this rule is invoked?
George: No, I don't have any statistics. I suspect it's not invoked very often because a lot of people don't know about it. I've read in different places that different fare experts have said that Rule 240 is kind of no longer in effect, and it's a shadow of its former self.
David: When we've touched on it in a previous podcast with Kate, who started the Passenger Bill of Rights push...
George: Yes, yes.
David: We had a couple of readers who actually wrote in and said, "Rule 240 doesn't exist anymore," and that we were spreading bad information.
George: Well, if you go to our site, and we have links to all the airline contracts of carriage, you'll see that some of them absolutely do have a Rule 240. It's there in black and white on your screen, and you can print it out in PDF form, and there it is. So I don't know what these people are talking about. Some airlines never had a Rule 240, and a few have weakened their Rule 240. But there are a few airlines, and maybe those are the ones that you want to fly, that do still have a Rule 240.
David: I think it's important to point out, too, that Rule 240 applies to American-based carriers on domestic flights.
George: Yes. Pretty much, yeah. Although, we'll get into the whole European thing...
David: Right.
George: Which applies to all airlines leaving Europe, and that's a whole different story. But passengers do have rights when they're leaving Europe, going anywhere. But we'll get into that. It's kind of exciting. [laughs]
David: [laughs]
George: And again, a lot of people don't know that they have rights.
David: Right, exactly. So this basically comes up. A traveler can invoke Rule 240 when their flight is delayed or canceled due to a problem that the airline is responsible for.
George: Right. Absolutely.
David: It's not a weather condition.
George: Absolutely. Air traffic control. I think one airline now has a strike situation to weasel out of 240. I understand that. So it has to be a problem within the airline's control.
David: Right.
George: It could be, for example, a crew didn't show up because there was a previous mechanical problem on their incoming flight and they were switching from one plane to another.

Usually, it's mechanical problems, but it could be something else. It could be that the caterer didn't bring enough food on, and they're waiting for the food to arrive for first class passengers; therefore, the flight was delayed. That's within their control, basically, because they hired the caterer.
David: Not to repeatedly bash airlines, but passengers are often suspicious when flights are delayed, that airlines lie about the reasons that the flights are delayed, or they just withhold information from them.

Is there a time limit that is set, so that, at a certain point, you can invoke Rule 240? Is there a way to challenge them, when they say a flight is delayed for specific reasons; when you suspect that it might be something else?
George: That brings up an interesting point. It may be that, if you're a great detective, you could find out if, indeed, it was a weather thing; or if, indeed, it was an air traffic control thing. I mean, you could call the airport and ask them if there was an air traffic control delay on a certain flight.

It's very, very hard to prove. Sometimes, it's pretty obvious; like when a jet engine falls off, but other times, it's not.
David: Right.
George: In addition to Rule 240, there are also other rules. There's a Rule 260 that a lot of people don't know about. That's simply that if your flight is delayed, or cancelled, so that your trip no longer makes sense...

Let's say that you're going to a wedding, or a funeral, or an important business meeting, and you were supposed to leave on a Tuesday. They're going to get you up on a Wednesday, instead, because all the flights are booked, and your flight was cancelled.

Well, you don't want to go to that meeting, because it's over. You have a non-refundable ticket. Are you allowed to get a refund? Yes, you are. A lot of people don't realize that.
David: Really?
George: Yep. If your trip is futile, for whatever reason, you are entitled to a full refund.
David: On Rule 260, what do you have to show to an airline to get a refund? A wedding invitation that says: here's the date I was supposed to be here. Your flight was delayed. I couldn't get there because of your flight; give me a refund?
George: No, you don't have to show them anything. The burden of proof is on them.

If your flight is delayed, and you say, "OK, I don't want to go now, because the point of my trip is useless now. It was your fault that the flight was delayed," and they're going to get you there the next day. Why go there?

These rules are also in the European community rules of laws that we're going to talk about next. They are definitely there.
David: Does Rule 260 apply to all airlines, or does it have to be within their contract of carriage?
George: No. Again, a lot of airlines don't have contracts of carriage at all. I suspect that most airlines, if you make a case, and the flight's severely delayed... They're going to give you your money back.

Most people want to get there, but if for whatever reasons, it's no longer an option to fly, then you should get your money back.
David: Right. Exactly. Well, you should. It doesn't always happen, and airlines do push back on this.
George: Well, I think a lot of people don't even ask. They figure, "Well, I'm just going to have to eat that ticket, or be charged a change fee." Why should you be charged a change fee for $100 to go another time within a year, if the airline couldn't get you where you're going?

I think most airlines actually will be pretty understanding, even if they don't have a formal Rule 260.
David: Right. How do European rules differ from American rules?
George: In Europe, it's a whole different ballgame. In Europe, airline passengers actually have rights. It's really amazing when you compare what we have to put up with in the U.S., with what they get in Europe.

If a flight is delayed, or cancelled...Now, there are exceptions, and we actually all these outlined in our blog, in an article that appeared a few days ago. You can find it. Just keep on looking on the blog. It's kind of long. The blog is getting longish.
David: Which is a good thing.
George: Pardon me? Yes.
David: And that's a good thing. You're putting more and more information up.
George: We also have it on the blog, cut and pasted from the airline contracts of carriage; the actual language for Rule 240 for some of the U.S. airlines.
David: Right.
George: Anyway, the Europeans have been writing laws much, much longer than we have in the U.S., and they've gotten it right.

It was in February, 2004 that the European Parliament got together and said, "We've go to give some rights to these airline passengers, because it's getting out of hand."

In the U.S., it's totally gotten out of hand, too. I mean, the airlines can do whatever they want. They're really running rampant, and I think they have to be slapped.

They really have to be slapped with some regulations, and I hope that's coming. Maybe, we'll talk about that later.
David: Sure.
George: Let's say your flight from Europe to the United States, which is a long-haul flight, is delayed for more than four hours. That airline is supposed to pay you up to $900.

Most people don't know that.
David: Wow.
George: The only U.S. airline that we've seen that says that it is U.S. Airways in their contract. You'll see it their contract of carriage. They say that you're going to get 600 euros, which is, these days, thanks to the weak dollar, about 900 dollars.

The other airlines don't have anything about this. They don't want you to know it, of course. Why would they want to?

European airlines do. British Airways, and Virgin spell it out. Lion Air, which we call the combative, low-cost carrier, refers to these rules, but merely says, "we're not responsible if the situation is out of our control," which is true. That's part of the fine print.

So no matter what your nationality, if you're flying from Europe, you get some kind of compensation, if your flight is delayed. That compensation ranges from about 125 euros--depending on how late your flight departed, and how late it arrived--up to a maximum of 600 euros; again, depending on how late you arrived, and how long your flight is.

If your flight is cancelled, there are also regulations. There are some exceptions. If you've been given enough warning about your cancellation notice--a week, or two weeks ahead of time--then the compensation is less, or there is no compensation.

If it's under a week, that's when compensation kicks in. It's similar to having a flight delayed.

If you're bumped, there's also similar compensation. It's much more than the bumping compensation here in the U.S., which is ridiculously low. We've had the same compensation for well over 10 years, at $200 to $400.
David: I've seen, as recently as this summer, going through San Juan, that typical San Juan Sunday, when all the cruise lines are done. Everybody's getting off the ship. They're ready to fly back home. All these flights are overbooked.

There was a bidding war by the airlines, basically, making announcements to pay people to get off the plane, but they started as low as 50 bucks. They would make announcements over the loudspeaker, "This flight is overbooked. We'll start with $50."
George: Really.
David: It was like an auction. Finally, they stopped making announcements when they got up to $400.
George: Right. They're going to have to pay somebody $400 anyway, to bump them off the flight, so they might as well get the ball rolling.
David: Oh, yeah. It seems really cost-effective for the airline.
George: What they try to do, of course, is give you a voucher, which is hard to spend, sometimes. Or a flight coupon is hard to spend. The vouchers are not as hard, necessarily.

The same thing applies in Europe, by the way. They have the option of giving you a voucher, if you'll accept it, but you should always take the cash. You should never take the flight voucher because you may not be traveling within a year.
David: It sounds like the burden is on airlines for European flights, as opposed to American and domestic flights. Are there statistics that show that flights are more regularly on time in Europe, as opposed to the United States, where we've had a record summer of flight delays and cancellations?
George: That I don't know. I do know that in Europe they have the same kind of bad weather that we have, and they have strikes, and that sort of thing. They're not immune to delays.

I would think that, since the airlines have to pay people for delays, they are going to be more honest with their schedules, and do everything they can. It's certainly an incredible incentive to fix any problems.

Again, they're off the hook if it's a weather delay, or a strike.
David: Sure, but it sounds like the European Union rules are clear cut, and they apply to all carriers operating flights within Europe.
George: Within Europe, or out of Europe.
David: Exactly. Within Europe, or flights departing from Europe to any other location.

It sounds like the rules for the United States actually vary from carrier to carrier.
George: They do vary, and they're not government regulations; whereas in Europe, they are government regulations. That's a big difference.
David: It's no surprise from Frommer's perspective, but we're proponents of government regulation of the airlines. We think that it makes sense; that it does not affect the marketplace in such a negative way, because, ultimately, it's better for the consumer.

Would you agree with that?
George: Yeah, I think it's better for the consumer. I think that, ultimately, it's better for air travel. I think a lot of people are staying away from air travel because there are so many horror stories, and they have no rights.

A friend of mine bought a $138 New York-to-Denver non-stop flight on Delta, to go over for the holidays. Delta had just announced this new route, over the summer; a new non-stop route from JFK to Denver. He got this fabulous fare, and it was non-stop. A few weeks before he was to depart, Delta announced that he was going to be put on a connecting flight.

Bad enough that the connecting flight left four hours earlier--he had to be at 6:00 AM from JFK--but it was no longer a non-stop. We checked, and we discovered that there were still seats available on Delta's non-stop flights, but they were being sold for over $600 now.

What happened, I guess, was that Delta said, "Hey, let's kick this guy off, put him on our less desirable connecting flights, and we'll sell the non-stops for $600."

That's kind of like if you had a contractor doing your kitchen, and a few weeks before the installation of the counters, they said, "We're substituting linoleum for the marble that you asked for, but we're going to charge you the same amount. Hope you don't mind."

And you have no right to say anything.
David: That's like ordering a cashmere sweater through a catalog or online, and they send you a polyester version three weeks later, and in the wrong size.
George: Right. [laughs] Exactly.

What other industry would get away with this? I don't get it.
David: None.
George: Of course not, but the airlines, for some reason, just get away with murder, and I think we need regulations. There are a lot of people in the industry, like the Business Travel Coalition, who don't think we need regulations. Of course, the airlines don't think so, and the Air Transport Association thinks it would be a bad idea, but there are regulations for other industries.
David: Right, as we're seeing now, across the board, within business, there are reasons for regulation. Part of it is consumer protection, financially. Part of it is consumer protection for safety.

We're seeing this through recent scandals of toys that are imported from China. This follows the same theme; that people are now in position for what should be consumer protection agencies who actually come from the industry that they are supposed to be regulating.
George: I think we have good regulations for safety. We just don't have them for financial protection for airline passengers, and this is what Europe has done right. I mean, Europe has absolutely done the right thing.
David: What can we do as travelers to get a change in the rules?
George: It's the usual thing. Write our congressman, and we can just try to influence legislation. There are some passenger rights groups, as you know. One can join them and support them. I'm hoping that, eventually, the situation is going to get so bad that...

Perhaps the new administration will get this. We have a very laissez-faire business environment with the current administration, and it extends, not just to airlines, but to all facets of industry.

Probably, enough people are just going to get screwed, and they will start uprising and demanding the same kinds of rights that Europe has. I think that, as more people realize that life is so much better for the airline passenger in Europe, people will start demanding their rights here in the United States.
David: So to wrap up, I guess that people here should really be aware of what their rights are before they even book a flight.
George: Sure. It's a great idea, when you fly, to print out the 240s on the airlines that have these rules, or Rule 260. If you're flying within, or from, Europe...the document isn't that long. You could print it out. We've actually cut and pasted the whole thing on our blog.

You could print it out, and should you get some kind of argument from an airline person, when your flight's cancelled or delayed, you can present this, and say, "Well, it says right here, in plain English, you guys owe me money."
David: Exactly.
George: In addition, the European regulations, if you're going to be a day, or more delayed, it legislates that you're supposed to get a hotel, phone calls, and meals. Most airlines in the U.S. will also give you that; mostly the old airlines. If they've really screwed up, they're not going to leave you on the airport floor.
David: Right. This is good information, too, for travelers to arm themselves with, as we come to the holiday season, which is typically unpleasant, just because of the volume of passengers who are getting on the flights.
George: Yeah, I know. You're better off staying home, if you can help it, because it's crazy. Or fly on Thanksgiving Day, when things settle down. Or Christmas.
David: Exactly. Yeah, tell my mother that I should stay home for the holidays.
George: Are you going somewhere?
David: Yeah. I'm flying to Indiana in December. I'm actually flying a week ahead of the holidays. We're working out of our Indianapolis office, so that I can avoid the holiday crush.
George: That's a great idea.
David: I can still do my job, and actually, the ticket is about $300 cheaper.
George: Oh, cool. Yep, all the better.
David: Right, but I know that doesn't work for most people.
George: No.
David: It happened to be fortuitous for me.

George, I want to say, "thank you" for talking with me today.
George: It's a pleasure. Thank you.
David: As always, it's informative, and I hope that our listeners will invoke Rule 240 and Rule 260, when applicable, and their rights as passengers when they're traveling on European flights, or American flights, as well.
George: Airline passengers, rise up.
David: Exactly. Fight the power.
George: But not if the seatbelt sign is on.
David: OK. [laughs] Exactly.

Thanks, George.
George: Thanks. Bye-bye.
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