Nova Scotia

Federal agency supports move by airlines to give vouchers, not refunds, amid pandemic

Canadians are speaking out about the refusal of airlines and some travel companies to refund fares after their flights were cancelled because of the COVID-19 pandemic.

Some airlines, travel companies offering credit, not refunds, and this is drawing the ire of many people

Katie Gillis from Halifax was scheduled to fly to Mexico with her fiancé on April 19, but now that trip's not happening because of COVID-19. (Submitted by Katie Gillis)

The federal agency responsible for passenger rights says it is appropriate for airlines to issue vouchers, rather than refunds, to customers who have had their trips cancelled amid the COVID-19 pandemic.

The response comes after Canadians have spoken out about the refusal of airlines and some travel companies to refund fares.

Katie Gillis and her fiancé were scheduled to fly to Mexico from Halifax, along with 30 relatives and friends on April 19 for their wedding three days later. They had booked all-inclusive vacations with Sunwing and collectively paid a total of about $57,600. 

"As far as I'm concerned, our contract was void and we should be refunded for that," Gillis said.

Members of her group have been refused a refund, and were instead offered a travel voucher that must be used within 24 months.

On its website, Sunwing says the policy applies to flights or vacation packages between March 17 and April 30.

Gillis said she's speaking out because she feels many others are in the same situation.

"In our group alone, several people are facing unemployment because of this pandemic and realistically might never be in a position to use a voucher. The refund would be much more appreciated," she said.

Scott McCormack and Sarah Hrdlicka spent almost $5,500 to rebook two flights, which were subsequently cancelled by Air Canada, to return from Peru to Canada. (Sarah Hrdlicka )

The Canadian Transportation Agency issued a statement about vouchers Wednesday, which was not attributed.

"It's important to consider how to strike a fair and sensible balance between passenger protection and airlines' operational realities in these extraordinary and unprecedented circumstances," the unsigned statement said. 

It went on to say that generally speaking, "an appropriate approach in the current context" could be for airlines to provide customers with vouchers or credits that are valid for 24 months.

The statement also says "any specific situation brought before the CTA will be examined on its merits" but the agency's website notes that it has paused all dispute resolution activities involving airlines until June 30, 2020 and left the door open to extending the pause. 

Many 'are in worse situations than we are'

Nova Scotians Sarah Hrdlicka and Scott McCormack are among the Canadians stuck in Peru trying to return home.

They had to cut their trip short and spent almost $5,500 to rebook two flights that were subsequently cancelled by Air Canada. They now must pay an additional $2,800 for two one-way flights from Lima to Toronto.

They will then incur additional expenses getting back to Nova Scotia. While it's cost them thousands of dollars, the couple says they are only "one example of hundreds, if not thousands, many of whom are in worse situations than we are."

They say they will simply be happy to get back to Canada. They don't know if they will receive a refund for any of the cancelled flights.

On March 24, Air Canada's president and CEO, Calin Rovinescu, posted a video about the impact of the pandemic on the airline's operations and its plans moving forward.

"For customers whose flights are cancelled, including at Air Canada Vacations, you'll receive a full credit valid for 24 months and there's no requirement to contact us," Rovinescu said in the video.

An Air Canada spokesperson relayed the same message in an email to CBC News, and did not respond to a question asking why only credits, and not refunds, were being issued.

'Countless Canadians have been penalized'

Charlottetown resident Barbara Dylla booked two Air Canada tickets to Ireland, but her flight was cancelled because of COVID-19.

She said she was told she could be refunded the $2,690 she paid, minus a $600 penalty. She declined and is now trying to convince Air Canada to give her a full refund.

She sent two emails to Transport Minister Marc Garneau and other politicians, saying "countless Canadians have been penalized by airline policies that allow the carriers to retain hundreds of dollars per ticketed passenger."

"Given the exceptional circumstances, I fail to understand what part of an airline ticket precludes a full refund when the passenger has virtually no choice to not travel," she wrote.

She is asking the federal government to order airlines to reimburse in full, no questions asked, tickets for travel within the next six or more weeks. 

'That's money that belongs to us'

Dylla is urging people to write to the transport minister and other federal politicians.

"That's money that belongs to us, to the customers, for services not rendered and people just cannot afford to be without a cent, so a full refund is due to passengers," she said.

Gábor Lukács, the creator of Air Passenger Rights Canada, says passengers should be refunded.

He points to an Aug. 29, 2013, decision from the Canadian Transportation Agency that involved a flight cancelled by Porter Airlines. The agency found it was "unreasonable for Porter to refuse to refund the fare paid by a passenger because of its cancellation of a flight, even if the cause is an event beyond Porter's control."

Consumer advocate and frequent flier Gábor Lukács says passengers are owed a refund. (CBC)

Lukács said it's a settled principle of law that if you don't receive the services that you have paid for, you are entitled to a full refund to the original form of payment.

"There is nothing in the law that justifies what the airlines and some suppliers are doing," Lukacs said.

However the Canadian Transportation Agency said in its statement that the Canada Transportation Act and Air Passenger Protection Regulations "only require that the airline ensure passengers can complete their itineraries." 

While some airlines provide for refunds in certain cases, the agency said, those same airlines "may have clauses that [they] believe relieve them of such obligations in force majeure situations."

'Extraordinary circumstances'

Amy Butcher, the director of communications for Transport Minister Marc Garneau, said in an email that the government is actively monitoring the situation and is working with airlines to try and find solutions.

"Additional questions regarding ticketing practices and refunds should be directed to airlines. We expect air carriers will do their best to work with passengers, their partners and others in the transportation sector to provide the assistance they can under these extraordinary circumstances," Butcher said.

She said the federal government wouldn't hesitate to act further to protect Canadians.

European rights 

On March 18, the European Commission issued a news release to "reassure passengers that their rights are protected" despite the pandemic.

"In case of cancellations, the transport provider must reimburse or re-route the passengers," Transport commissioner Adina Vălean said. 

He said if passengers cancel the flight, reimbursement "depends on its type, and companies may offer vouchers for subsequent use."