Getting a refund for canceled flights may be harder than you think

In defiance of Israeli law, some airlines are only offering future credit for flights instead of paying customers back within 21 days.

By Batya Jerenberg, World Israel News

Israeli consumers have begun complaining that in contradiction to the law, airlines have not refunded them for flights that were cancelled as a result of the coronavirus pandemic, Globes reported Tuesday.

Thousands of flights throughout the world have been voided in the last six weeks. International travel has virtually shut down as countries close their borders in an effort to contain the spread of the virulent disease. And that means that a whole lot of business travelers and vacationers who paid in advance for their tickets deserve, and are expecting, to be refunded by their respective airlines.

Israeli aviation law is on their side, as it clearly states that if the airline cancels a flight, it is obliged to return the consumer’s money within 21 days. Even if the customer himself cancels the flight, as long as he did so within 14 days of booking it, he is entitled to reimbursement.

Yet, Globes reported on Tuesday several stories of people who were only offered future credit instead of a refund to their credit card accounts.

When United Airlines was asked by the business daily why it was not obeying the law regarding a certain customer, the company answered that if the passenger doesn’t use the credit he receives within 12 months, he will receive a refund.

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Such a policy, it said, allows the airline to keep cash it needs to continue operating under the difficult circumstances due to the pandemic.

El Al has also been telling customers that their tickets are being held for them for when flight travel will be permitted once again. The company additionally excused itself by saying that there was no one to handle refunds right now.

El Al has reduced its staff by 85 percent since the beginning of the pandemic.

As A. put it to Globes, however, “This is an irrelevant claim. Just as many of us are working from home, this, too, is something that needs to be taken care of from home. El Al is wrongly holding vast sums of thousands of canceled tickets at the expense of the citizens. I also need the money now at such a difficult time.”

The problem is that there isn’t much consumers can do about the situation. They could take the airline to court – except that courts are basically closed right now. Even when they are open, it is well-known that cases take a long time to be heard. And if their particular airline goes bankrupt because of the current crisis, their chances of being reimbursed are almost non-existent.

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“Because creditors are prioritized, the customers are last, after banks, suppliers and employees – and they will get crumbs, if any,” Israeli lawyer Asher Rotbaum told Globes.

The Ministry of Transportation is also considering whether to amend the law in light of the unprecedented situation – in favor of the airlines. The proposal is to stretch the restitution period from 21 days to 90 days, and to make this amendment retroactive to February 28, the beginning of the travel shutdown.

Consumer Protection Authority director Michael Atlan pointed out that the law also provides for additional compensation to travelers when flights are cancelled, over and above a straight refund. In light of the pandemic, he said, “We’re willing to swallow the pill of giving up on the compensation, but there’s a huge difference between that and giving up on money that has already been paid.”

Atlan made a very practical suggestion that could save at least some money for those who paid for their tickets in installments: To call the credit card company and demand that all future payments be stopped due to the failure in receiving the goods.