The Biden administration proposed new regulations Monday that would require airlines to compensate passengers and cover their meals and hotel rooms if they are stranded for reasons within the airline's control.

The proposed rules “will make it mandatory – not voluntary, but mandatory – for all U.S. airlines to compensate your meals, hotels, taxis, rideshares, and rebooking fees, and cash miles and/or travel vouchers whenever they’re the ones to blame for the cancellation,” President Joe Biden said layter Monday afternoon. “And that’s all on top of refunding the cost of your tickets.”


What You Need To Know

  • The Biden administration is starting work on new regulations it says will expand the rights of airline passengers

  • The proposed rules would require airlines to compensate passengers and cover their meals and hotel rooms if they're stranded for reasons within the airline's control

  • The rulemaking pledge continues a push by the Democratic administration to require airlines to improve customer service, and it comes just weeks before the start of the peak summer travel season

  • Even after the rule is officially proposed, it could be years before it's implemented

The rulemaking pledge continues a push by the Democratic administration to require airlines to improve customer service, and it comes just weeks before the start of the peak summer travel season.

Currently, when an airline cancels a flight for any reason, consumers can demand a refund of the unused part of their ticket and certain extras that they might have paid to the airline, such as fees for checking a bag or getting a seat assignment. Airlines often try to persuade consumers to accept a travel voucher instead of a refund.

“I know these things may not matter to the very wealthy, but they matter the most to middle class families of people struggling to get the cost in the first place of getting that airline,” Biden said.

Even after the rule is officially proposed, it could be years before it's implemented, according to Bill McGee, a senior fellow for aviation at the American Economic Liberties Project. There will be a public comment period and layers of analysis and study as it works its way through the federal bureaucracy.

“We have been saying for many years that the Department of Transportation, which is really the sole regulator of the industry, needs to step up and do more. And that's what we're hearing today,” McGee said. “It is the best long term solution to provide mandatory rights for consumers so that there is uniform and consistent and mandatory protection when your flight is delayed, or your flight is canceled.

Biden highlighted a Department of Transportation dashboard that tracks airline compensation in the event of cancellations and delays. It launched last year after widespread flight disruptions last summer and was expanded on Monday, a move McGee said will help shame airlines “into treating customers better.”

“If you look at the dashboard today, you’ll find that only two airlines guarantee additional compensation beyond the ticket refund,” Biden said. “If your flight is very delayed or canceled, and the airline could have prevented that, you deserve more than just getting the price of your ticket. You deserve to be fully compensated. Your time matters. Impact on your life matters.”

Last fall, each of the 10 largest U.S. airlines quickly promised to provide cash or vouchers for meals when a cancellation forces passengers to wait at least three hours for another flight. Nine of the 10 — all but Frontier Airlines — also promised to pay for accommodations for passengers stranded overnight.

“Airline passengers in Canada, for example, in the European Union, in other places already get these compensations. And guess what? It works,” Biden said. “One study found that the European Union required airlines to compensate passengers for flight delays, the number of flight delays went down.”

2018 study from the European Union Institute, an independent research organization funded by the European Union, found Europe’s rules on travel compensation led to a 5% increase in on-time flights, with the average delay reduced by nearly four minutes.

“To put things in context, you have many more rights when you’re flying overseas, in the European Union, in Canada, in Asia, in the Middle East, than you do in the United States,” said McGee. “So the irony is, if you're flying on a U.S. airline, you are much likely to be treated better and more fairly on foreign soil than on U.S. soil. But you have to think about that for a moment. That's pretty crazy. But that's how it is.”

When a traveler buys an airline ticket, McGee explained, they are agreeing to a contract that binds you to the airline’s rules, which are based in the regulations of their home country. According to McGee, U.S. airlines have some of the least customer-friendly rules in the world.

“Most people have never heard of it, but you do sign it, you can trust me. Every time you buy a ticket, you are agreeing to a contract that was written by and for the airline,” McGee added.

Questions in the United States arose again around reimbursing consumers for out-of-pocket costs after Southwest Airlines canceled nearly 17,000 flights during a December meltdown in service. The Transportation and Justice departments are investigating whether Southwest scheduled more flights than it realistically could handle.

The Transportation Department says it is working with the airlines to reduce cancellations and delays this summer, when air travel could exceed pre-coronavirus pandemic records.

A report last month from the congressional Government Accountability Office blamed airlines for many cancellations, but the Federal Aviation Administration has also created disruptions due to technology outages and staffing shortages. The FAA recently encouraged airlines to reduce flights to and from major New York airports this summer because it doesn't have enough air traffic controllers at a key facility.

On Monday, Secretary of Transportation Pete Buttegieg said in New York specifically the Department of Transportation had moved to allow airlines to use larger planes to transport more passengers while reducing congestion.