Whether the problem is weather or staffing, refund rules apply to flight cancellations and delays

More than 17 million Americans planned to fly this holiday weekend — a record-setting Labor Day, according to the Transportation Security Administration.

No doubt, some of those travelers will have their flights delayed. But airlines and federal regulators hope to minimize the number of flights that are canceled outright. New data from the Department of Transportation shows that through the first half of this year, before the huge CrowdStrike outage in July, flight cancellations were down slightly from 2023. 

And the DOT wants to implement new rules that require airlines to give customers automatic refunds for canceled or significantly delayed flights.

When an airline cancels your flight, it can feel like a personal punishment. But airlines really don’t want to resort to cancellations, said analyst Helane Becker at TD Cowen. It costs them.

“They have to accommodate passengers with meal vouchers, sometimes with hotel vouchers, and that’s obviously quite costly. And then it has to pay overtime to its employees, and that’s quite costly,” she said.

In other words: “The airlines don’t do well when they deliver a crappy product,” Becker said.

Federal regulators want to make the process of getting a refund for a canceled or very delayed flight a lot less crappy.

“If your flight is canceled, the airlines have to give you automatically a refund in your original payment form. So that’s cash, credit card, miles, whatever,” said David Slotnick, senior aviation business reporter for the Points Guy.

It’s part of a broader push by the government to crack down on flight cancellations.

Henry Harteveldt, an analyst at Atmosphere Research Group, said a lot of things are within an airline’s control. “Not having enough crew, too bad. That’s an airline problem.”

Aircraft maintenance problems are also an airline’s responsibility, he said. 

Airlines have mostly recovered from shortages of pilots and crews in recent years, which has helped. Even so, most delays are caused by something they can’t control, Harteveldt said: the weather.

“Whether it’s snowstorms in the wintertime or thunderstorms and hurricanes in the summer, we are seeing more bad weather events, and these bad weather events tend to be more intense, happen more frequently and can last longer,” he said.

Airlines, he said, are trying to factor worsening storms into their planning. Because they’ll be on the hook for refunds even if it’s weather that keeps the planes on the ground.