Untied Airlines: a personal perspective

Laws

This page isn't meant to be a comprehensive survey of passenger-protection laws; it's limited to the laws that I've seen United and its partners violating. For example, I haven't seen United and its partners violating the EU laws requiring hotel accommodation after cancelled flights, so I don't discuss those laws; but I've never seen United and its partners obeying the EU laws requiring compensation for cancelled flights, so I do discuss those laws.

Reimbursement for damaged and delayed baggage on international flights

Article 18 of the Warsaw convention states that "The carrier is liable for damage sustained in the event of the destruction or loss of, or damage to" any checked bag; Article 19 of the Warsaw convention states that "The carrier is liable for damage occasioned by delay in the transportation by air of passengers, baggage, or cargo." Articles 18 and 19 of the Montreal convention say the same thing. In particular, if an airline fails to put your bag on the plane and doesn't deliver the bag to you later, it has to reimburse you for whatever damage you suffered as a result of this delay.

Article 30 of the Warsaw convention gives passengers a right of action against "the first carrier" and gives passengers a right of action against "the last carrier" and gives passengers a right of action against "the carrier who performed the carriage during which the destruction, loss, damage or delay took place." Article 36 of the Montreal convention says the same thing.

There are exceptions in the Warsaw convention if the carrier can prove that it has "taken all necessary measures to avoid the damage or that it was impossible for them to take such measures" or that the damage was "caused by or contributed to by the negligence" of the passenger. There are similar exceptions to the Montreal convention. For example, if an airline can prove that it was forced by weather to delay your bag, then it doesn't have to reimburse you for the delay; if an airline can prove that you did a bad job of packing fragile wine glasses that broke, then it doesn't have to reimburse you for the cost of replacing the wine glasses.

These treaties express reimbursement limits in "SDRs" ("Special Drawing Rights"), a currency unit; 1 SDR was worth about $1.5 in late 2012. The Warsaw convention set a limit of 17 SDRs/kg for checked baggage (e.g., 195 SDRs for a 15kg checked bag) plus 332 SDRs per passenger for carry-on baggage. (If part of your checked baggage is lost, damaged, or delayed then the limit is for "the total weight of the package"; other bags on the same bag check are included if their value was diminished by the loss, damage, or delay, but airlines evade this rule by issuing a separate check for each bag.) The Montreal convention originally set a baggage damage limit of 1000 SDRs per passenger, and now sets a limit of 1131 SDRs per passenger.

Article 26 of the Warsaw convention requires baggage damage complaints "within seven days from the date of receipt" and baggage delay complaints "within twenty-one days", in both cases in writing. Article 31 of the Montreal convention says the same thing.

To summarize: If you fly internationally, and the airline screws up and delivers your bag late, and you complain in writing within 21 days, then the airline has to reimburse you for the damage produced by this delay. Similar comments apply to damaged bags and damaged contents of bags, except that it's only 7 days instead of 21 days. If several airlines were involved then you have the right to obtain this reimbursement from the responsible airline (if you know which one that was), or from the first airline, or from the last airline—your choice.

Compensation for cancelled and delayed European flights

Article 4(3) of the regulation states that the airline must immediately compensate you if it denies you boarding against your will. Article 5(1)(c) of the regulation states that the airline must compensate you if it suddenly cancels a flight. (Non-sudden situations: you're notified two weeks in advance; you're notified one week in advance and are given a replacement flight allowing you to leave two hours earlier and arrive four hours later; you're given a replacement flight allowing you to leave one hour earlier and arrive two hours later.) The compensation amounts are as follows:

• for flights under 1500km: 125 EUR, doubled if you aren't offered rerouting on a flight arriving at most two hours later;
• for other flights within the EU and other flights below 3500km: 200 EUR, doubled if you aren't offered rerouting on a flight arriving at most three hours later;
• for flights above 3500km: 300 EUR, doubled if you aren't offered rerouting on a flight arriving at most four hours later.

What about long delays? The Fourth Chamber of the European Court of Justice, in a 2009 case (Joined Cases C-402/07 and C-432/07 Sturgeon and Others [2009] ECR I-10923), stated that the airline must provide the same compensation to passengers who "suffer, on account of a flight delay, a loss of time equal to or in excess of three hours, that is, where they reach their final destination three hours or more after the arrival time originally scheduled by the air carrier." The Grand Chamber of the European Court of Justice, in a 2012 case (Joined Cases C-581/10 and C-629/10 Nelson [2012]), reaffirmed the same rule, and also clearly stated that compensation for inconvenience under this law is separate from compensation for damage under the Montreal convention.

Article 14 of the law is an interesting "Obligations to inform passengers of their rights" provision. In particular, Article 14(2) states that "An operating air carrier denying boarding or cancelling a flight shall provide each passenger affected with a written notice setting out the rules for compensation and assistance in line with this Regulation. It shall also provide each passenger affected by a delay of at least two hours with an equivalent notice. The contact details of the national designated body referred to in Article 16 shall also be given to the passenger in written form."

There are a few exceptions to the compensation rule. Most importantly, the airline doesn't have to compensate you for a flight cancellation (or delay) caused by "extraordinary circumstances"; this includes weather severe enough to cause flight problems. However, "extraordinary circumstances" do not include mechanical problems. Furthermore, the airline has to give you a written notice of your rights even if the airline claims that there are "extraordinary circumstances".

You also aren't protected by this law if you don't have "a confirmed reservation on the flight" or if you don't present yourself for check-in "as stipulated and at the time indicated in advance and in writing" by the airline (or 45 minutes in advance if no time is indicated). However, if you check in for one flight and the airline then transfers you to a second flight, your protections continue to apply to the second flight.

You also aren't being "denied boarding" if there are "reasonable grounds" to keep you off the plane, "such as reasons of health, safety or security, or inadequate travel documentation". However, overbooking is not "reasonable"; an airline guessing incorrectly that you won't make a connecting flight is also not "reasonable".

What about U.S. flights?

Does it make economic sense for United and its partners to obey these laws?

Now imagine how much money an airline could save by the following brilliant idea. When a passenger complains, don't reimburse the passenger as required by law; instead tell the passenger that reimbursement is subject to much lower limits, or isn't available at all. For example:

• Tell passengers that they aren't entitled to reimbursement for damage to bag wheels.
• Tell passengers that they aren't entitled to reimbursement for a bag that's delayed only 24 hours.
• Tell passengers that they aren't entitled to reimbursement if they didn't file a luggage report before leaving the airport.
• Tell passengers that they aren't entitled to reimbursement for anything valuable or irreplaceable.
• Tell passengers that they're entitled to reimbursement for only half of the emergency replacement clothing they were forced to buy.
• If you aren't the last carrier, tell passengers that they're entitled to reimbursement only from the last carrier.

Samuel Podberesky, Assistant General Counsel for Aviation Enforcement and Proceedings at the U.S. Department of Transportation, sent airlines a letter on 9 October 2009 declaring that "any arbitrary limits on expense reimbursement incurred in cases involving lost, damaged or delayed baggage" violate 14 CFR § 254 and "constitute an unfair and deceptive practice and unfair method of competition in violation of 49 U.S.C. § 41712." Okay, so it's clearly and indisputably unlawful; but it still saves lots of money. What's the sensible course of action for United and its airline partners?

Similarly, think about how much an airline is required by law to pay when it cancels a flight in Europe because of mechanical problems. Imagine how much money the airline could save by simply not paying:

• Don't give the passengers any hints that they have a right to compensation, or any other rights. In particular, don't hand out the passenger-rights notices required by law.
• If a passenger asks whether reimbursement is available, dodge the question. For example, say how sorry you are that the flight had to be cancelled, and say that another agent will be happy to look for replacement flights.
• If the passenger persists in demanding reimbursement, apologize and repeat the same story.
• If the passenger insists that reimbursement is required by law, point the passenger to a service desk at the opposite side of the airport, or to a web page that doesn't actually exist.

Do United and its partners actually obey these laws?

violations ... of Article 19 of the Montreal Convention and ... 49 U.S.C. § 41712, in connection with monetary claims resulting from its delay in delivering checked baggage.

Lufthansa was limiting reimbursement to 50 percent of the claimed expense against original receipts for damages associated with a delay in returning checked baggage ... Lufthansa ... had accordingly advised numerous claimants ... that Lufthansa would reimburse only 50 percent of the cost of clothing items and 100 percent of the cost of toiletries and underwear.

How exactly is a $50000 fine supposed to act as a deterrent against a company that had 28730000000 EUR in revenue in 2011? The answer is that it doesn't. Consider, for example, the email that Lufthansa sent in mid-November 2012 to a passenger who had requested reimbursement more than a month earlier (and followed up repeatedly in writing):

With regards to the unexpected expenses you incurred as a result of this delay, we will be happy to reimburse these within the scope of our legal liability. We will refund half the cost of clothing and the full cost of toiletries and underwear.