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'Quick and dirty': Here's why it might get harder for Canadians to get refunds for flights

Check out a video that explains why airlines might not be held accountable for Vancouver flights.

After immense public outcry following years of pandemic-spurred frustration with Canadian airlines, the federal government has promised changes to its current air passenger rights charter to hold them accountable.

But advocates say Canada's plans to overhaul the current regulations shortchange consumers and leave too much discretion to airlines.

"There's no doubt that the government is spinning this as a 'win' for consumers," argues John Lawford, Executive Director of the Public Interest Advocacy Centre (PIAC).

"The minister came out and said that this would mean compensation for everybody unless the airlines can show on the balance of probabilities that they're right. It's not quite that simple."

Instead, the public interest advocate told V.I.A. the proposed legislation may actually reduce the ability of air passengers to navigate the updated system and provide airlines with a way to avoid paying the massive penalty meant to keep them in check. 

Canada's first air passenger rights regime, the Air Passenger Protection Regulations (APPR), was implemented in 2019. But these rules have been heavily criticized over the course of the pandemic since airlines were able to avoid paying compensation due to things like safety issues. 

Proposed changes to the Canada Transportation Act

On April 24, Transport Minister Omar Alghabra announced the proposed amendments to the Canada Transportation Act, introduced as part of Bill C-47, the Budget Implementation Act, to simplify the process of administrating air travel complaints and "increase air carriers’ accountability."

Gábor Lukács, the founder of the Air Passenger Rights group, says advocates predicted several issues with the current regime that travellers faced over the past few years, including issues with refunds, the burden of proof, and allowing the airlines to avoid paying compensation based on what they deem to be an issue that falls within the three, broadly-defined categories considered outside of their control: safety and security, medical emergencies, and natural phenomena.

The advocate stresses that airlines have been able to avoid paying out refunds for reasons they arbitrarily characterize as "outside of their control." In some cases, carriers argue that circumstances like not having enough crew on a plane are "a safety concern" and outside of their control.

In the European Union, airlines can only avoid paying compensation if they prove the existence of an extraordinary circumstance. They must also pay air passengers for "flight delays and cancellations caused by maintenance issues," which is something Canadian carriers could avoid, said Lukács.

Airlines in the EU are also on the hook for proving the existence of an "extraordinary circumstance" and must provide passengers who are stranded in a destination with meals and accommodation, regardless of the circumstances. 

Lawford echoed this sentiment, noting that Canada's current charter currently offers too much room for interpretation by airlines.

Given the immense backlog of complaints to the CTA, Canadian air passengers have also been forced to wait significant periods of time to receive compensation, and, in many cases, they do not receive the money they are owed. 

"You might not get anything. You might be denied depending on if the airline can prove this is a safety issue or if it's outside their control," he said. 

Since the European rules are straightforward, companies have popped up that offer to process claims on behalf of air passengers because they know exactly how much money will be paid and when that will happen, Lawford said. 

In Europe, if your flight is late or cancelled, "you get certain rights like food and lodging and that sort of thing, but you also get your money back, plus the inconvenience payment," he explained. 

He cites some rare exemptions, like volcanic explosions or earthquakes.

Will the overhaul of Canada's air passenger rights charter prevent these issues?

The proposed changes allow the CTA to make compensation mandatory for all disruptions unless they are caused by "very limited circumstances" which it can modify.

"There's nothing to stop that exception from including the three categories again and have it letting the airlines say, 'yes, this is a safety reason, this is outside our control and therefore we should have an exception for that situation," Lukács emphasized. 

In March, New Democratic Party (NDP) transport critic Taylor Bachrach tabled Bill C-327, which sought to address some of the key issues with Canada's current air passenger rights regime and Lukács argues would have aligned it with the European Union's "gold standard."

Bill C-327 would also "would close the loophole reasons which the minister agrees that it needs to be closed," he added.

"But [Alghabra's] legislation doesn't do that. Actually, the bill that the minister put forward has the words 'required for safety reasons' four times in a new text." 

And while many people praised the introduction of a steep fine for airlines, with penalties rising ten-fold to $250,000 per violation, the airlines may not be forced to pay them.

Under the new legislation, if the airline agrees to sign a compliance agreement, they don't have to pay the fine. 

"A compliance agreement is a generic term that [typically] means that they promise to behave better going forward," he said. 

Lawford added that this loophole "may well be a way for airlines to avoid actually having to pay the fines and not change their practices depending on how much the agency CTA follows up."

Under the new rules, airlines must tell passengers if they will receive a refund or compensation within 30 days of a request. Previously, the airline only had to respond to them within a month's time. 

And while this amendment will expedite part of the refund process, Lawford notes that the new system removes the consumer's right of appeal.

"We complicated this somehow," he said. "We ended up with a real mess."

The new system doesn't include the old protections, where consumers could opt out of the process and go to Small Claims Court or try another avenue. Instead, an inquiry officer is appointed to the case, which might mean that many complaints are "thrown out" or characterized as "frivolous," Lawford described.

"So we don't know how serious the process is gonna be, but it's meant to be quick and dirty and it might be more dirty than quick."

In other words, the new rules might mean that some Canadian passengers never see refunds for flights that they may have under the current regime.

Travel agency weighs in on YVR airline issues 

Karlyn Bauer, Retail Operations Leader at Flight Centre Travel Group, says the company processed upwards of 40,000 refunds in Canada over the course of the pandemic, and its agents were "bombarded" with client questions concerning money and airline status. 

"It was intense," she told V.I.A. "It was traumatizing for agents and clients." 

While the travel landscape has improved, airlines and airports continue to experience staffing shortages, resulting in cancellations and delays.

Travellers who book with a travel agent have "an expert on their side" who has a direct relationship with airlines, meaning that they can advocate on their behalf.

In situations where customers find themselves unable to get through on the consumer telephone number, an agent will get through significantly quicker, explained Bauer. 

If you booked with a travel agent, the best course of action is to go to the agency first to discuss refund or compensation options. If you booked directly with the airline, you should go to them first and as soon as possible, said Bauer. Many claims must be submitted within a given window of time. 

Lawford added that consumers who are unhappy with an airline result can go to the CTA, "but they should know that if they do that, they're not going to be able to go and make a different claim in small claims. 

"So if you had something really disastrous happen, a very big claim, you might want to go to Small Claims Court."

But if you think that you are owed money, Lawford stresses that you must advocate for yourself. The airlines won't follow up with people to ensure they get what they are owed.

"When you have a late flight, only the people that complain make money," he said.

"If you have 200 people on a plane and only 20 of them complain, only 20 people make money."