If you had a flight booked in the coming months, there’s a good chance it’s been cancelled as airlines globally cut flights in response to the COVID-19 outbreak.
Instead of just giving you a refund, most airlines would like you to accept a credit voucher for the value of your ticket, to use towards a future booking. From the airline’s point of view, this makes perfect sense. It stops the airline from having to refund money to passengers at a time of negative cash flow. It also locks customers in to using the airline again when things return to normal.
But, with limited exceptions, airlines are legally obliged to refund your money if your flight is cancelled and you’re not given a suitable alternative. Virgin Australia seems to disagree with this, saying that an exception may apply if flights are cancelled due to government restrictions. Virgin is currently offering customers only the ability to rebook or cancel for a credit voucher without penalty. But we would argue that airlines are still free to operate flights as they wish despite the current travel restrictions; most of the current cancellations are due to a lack of demand.
Australian Consumer Law continues to apply, so if you want a refund for a cancelled flight, you should be entitled to one!
Why airlines need to be more generous with their vouchers
At the moment, some airlines are denying refunds for cancelled flights, pretending that credit vouchers are the only option, or changing their IT systems to make it near-impossible to access a refund.
Instead of trying to trick or coerce customers into accepting a voucher, airlines should be making their credit vouchers attractive enough that customers want to accept them.
Currently, many airlines’ vouchers have limited validity. And customers cannot be sure they’ll get value from their vouchers as airfares could increase in the future. (There’s also a small risk that the airline could go out of business before you’re able to use the voucher.)
For example, Jetstar credit vouchers can only be used within six months. That’s a terrible policy as nobody knows if things will be back to normal in six months’ time. So, if your Jetstar flight has been cancelled, your best option is to contact the airline to request a refund instead (which Jetstar will provide for cancelled flights, if you ask).
Luckily, some airlines have now realised how short-sighted it is to offer inflexible and unattractive vouchers when customers have the option of a full refund instead. These airlines have already made changes to their credit vouchers to make them more attractive. For example, Aer Lingus is now adding 10% in value to all credit vouchers and making them valid for five years. Qatar Airways is also increasing the value of vouchers by 10%. Meanwhile, Lufthansa Group airlines are giving a €50 discount when passengers make a new booking with their voucher.
It’s in both the customers’ and the airlines’ interest to offer vouchers with long-term validity and extra value. Why should customers agree to give airlines what is effectively an interest-free loan, when there’s nothing in it for them?
Qantas extends validity of credit vouchers, but refunds hard to get
If your Qantas flight is still operating, but you no longer wish to travel, you have the option to cancel your booking and convert the value of the ticket to a credit voucher without penalty.
If your flight was cancelled by Qantas, the airline will automatically convert your booking into a credit voucher. In this instance, you are also entitled to a full refund. But you’ll have to proactively request this. You may be able to do so online after your booking has been converted to credit, but if not, you’ll need to contact the airline.
Sadly, Qantas is even making it difficult for customers with refundable, fully flexible bookings to get a refund. Several AFF members have complained that they were only able to cancel for a credit voucher online – and not a refund – despite holding Flex tickets.
To be clear, you are entitled to a refund for cancelled flights if you want one. If you’re unable to get a refund online, you’ll need to call or message Qantas directly (or, your travel agent if you booked with a third party) as the ability to request a refund appears to have been removed from the Qantas website. The problem with this is that the Qantas call centre is currently overwhelmed with requests. So unless you have top-tier Qantas status or call during the middle of the night, you can expect to wait on hold for hours. (Perhaps this is precisely the point…)
The good news is that Qantas has now extended the validity of credit vouchers until December 2021. Although Qantas is not offering to increase the value of your voucher – and you’ll have to spend at least the value of your voucher on the new flights – this at least gives most people a realistic opportunity to use their vouchers in the future. So, if you think you’ll fly with Qantas again once the travel restrictions are lifted, you at least don’t have much to lose by accepting the credit voucher.
Join the discussion on the Australian Frequent Flyer forum: Qantas booking cancellation (under covid19)
