The Biden administration on Monday announced plans for new regulations to require airlines to provide compensation and cover expenses for meals and hotel rooms to stranded passengers when the companies are at fault for travel disruptions.
"I know how frustrated many of you are with the service you get from your U.S. airlines," President Joe Biden said in remarks from the White House announcing his administration's plan. "That's why our top priority has been to get American air travelers a better deal."
He said that later this year, his administration will propose a historic new rule that will make it mandatory for all U.S. airlines to compensate travelers for "meals, hotels, taxis, rideshares and rebooking fees and cash, miles and, or travel vouchers whenever they're the ones to blame for the cancellation or delay. That's all on top of refunding the cost of your ticket."
The administration has also expanded an online dashboard to provide travelers with more transparency on airlines' compensation policies, Biden added.
"These actions are in addition to other progress we’re making to lower costs for American families, holding corporations accountable and growing our economy from the bottom up in the middle out, not just the top down," he said.
Transportation Secretary Pete Buttigieg joined Biden for the announcement and said the administration has already seen improvements each month so far this year. He said that preliminary data shows cancellation rates for flights are below 2%. Buttigieg said, however, that the summer travel season is going to "put enormous pressure on the system."
Airlines currently do not guarantee cash compensation when an airline-related issue causes a significant delay or cancellation. Airlines often guarantee frequent flyer miles, travel credits or vouchers to passengers who experience delays or cancellations caused by an issue within the airline’s control, such as a mechanical issue. The Transportation Department said in a release that it seeks to ensure that passengers are better protected against financial losses with the proposed rules, and that it plans to define “controllable cancellation and delay” in this rulemaking.
The announcement comes as part of a push by the Biden administration to improve customer service to airline passengers. The Transportation Department unveiled an online dashboard designed to improve customer service after widespread flight disruptions last summer. The dashboard allows passengers to check an airline’s refund policy and compensation in the event of a flight cancellation or delay. Many of the largest U.S. airlines guarantee meals or hotel stays when they are at fault for a delay or cancellation, according to the dashboard.
The department also said it believes that the proposed rules will help improve airlines' on-time performance.
It launched an investigation into Southwest Airlines after thousands of its flights were canceled in late December. The department said it was investigating whether company executives scheduled an unrealistic volume of flights, “which under federal law is considered an unfair and deceptive practice.” The carrier said it is cooperating with all inquiries.