Coronavirus: Travel operators 'continue to break law' over refund failures despite reassurances

It comes amid continuing concerns that airlines have held back billions of pounds in refunds, as they battle with the worst financial crisis their industry has ever faced.

Holiday companies should offer refunds within 14 days while for airlines it is seven days, but many consumers were still waiting for their cash months after trips were cancelled because of the coronavirus.

Last week the CAA said it had found airlines had upped theirgame when it comes to providing refunds following a review of the refund policies and performance of UK airlines and three of the largest international operators to the UK.

Which? says it has now seen evidence that the airlines are "reneging" on promises about how they would improve their refund processes, including from some passengers who have been left out of pocket since March. The findings come after the CAA reviewed airlines’ behaviour and identified several carriers that weren’t paying refunds "sufficiently quickly", but opted not to take enforcement action after receiving commitments from the airlines to improve their performance.

Virgin Atlantic was the only airline facing enforcement action over its delays in processing refunds for cancelled flights.

However, Which? found that Ryanair, Tui and Virgin – all identified by the CAA as not processing refunds fast enough – were falling short of the promises they made to the regulator, prompting concerns from Which? that the regulator’s enforcement powers "may not be fit for purpose".

The consumer organisation is now calling for the government to enhance the CAA’s existing powers to allow it to "more easily take swift and meaningful action against airlines that have repeatedly been exposed for disregarding the law and their passengers over the course of the pandemic".

The CAA told Ryanair it wasn’t satisfied that it was taking 10 weeks or longer to process refunds, and that airlines offering vouchers should also be offering passengers the choice of a cash refund. Following the regulator’s review, Ryanair published a commitment on its website that all refund requests up to the end of May would be cleared by July 31.

But Which? said it had heard from Ryanair passengers who are still waiting for refunds from March, and who are still trying to get cash refunds after they were initially sent vouchers despite requesting cash refunds.

Virgin Atlantic told the CAA its maximum waiting time for refunds is 120 days, but Which? said some passengers have been trying to get refunds from the airline for longer than four months. The consumer champion heard from two passengers who have been waiting over 130 days for refunds for flights that were cancelled in March.

Tui was reprimanded by the CAA for issuing vouchers and then making customers wait a further 28 days before they could apply for their money back. Tui told the CAA that “on average, cash refunds will be processed within 14 days”.

But Which? said that despite telling the regulator it is no longer automatically issuing vouchers, Tui still states on its website that customers must wait for a voucher before they can claim a cash refund. Which? has heard from a passenger who is yet to even receive the voucher that she needs to claim her refund – or received any other communication from Tui – after her flight was cancelled in April.

Following its review, the CAA said a number of airlines committed to speeding up the time it is taking to process refunds without requiring enforcement action, and that it would continue to monitor those airlines and continue to push for further improvements.

A Which? spokesman said: "We are concerned that if airlines are continually allowed to openly break the law on refunds through this crisis, it will set a precedent that sees airlines continue to treat passengers unfairly without fear of consequence or sanctions.

"Airlines have repeatedly been given the benefit of the doubt, but some have treated the regulator’s efforts to secure voluntary commitments with indifference. It is clear that more needs to be done to give the CAA the clout to effectively hold airlines to account."

Kirsty Ness, a teacher from Edinburgh is among those who have raised their concerns with the consumer organisation. She requested a cash refund from Ryanair immediately after her flights were cancelled in late March, but on 20 April she received a voucher instead.

She says she has called Ryanair several times to cash in the voucher, but she has yet to receive her refund.

Which? believes there should be a series of reforms to the travel industry, to help ensure the future of international travel from the UK and to help restore consumer trust in the sector.

Rory Boland, Which? travel editor said: “Time after time, Which? has exposed airlines breaking the law on refunds for cancelled flights due to the pandemic and treating their passengers unfairly, and we’re concerned that they now feel empowered to do as they please without fear of punishment.

“Passengers must be able to rely on a regulator that has effective powers to protect their rights – especially at a time of unprecedented turmoil. The government needs to step up and ensure the CAA has the tools it needs to hold airlines to account, or risk consumer trust in the travel industry being damaged beyond repair.”

A Tui spokesman said: “Customers with cancelled flight only bookings which were due to depart before 11 July were issued refund credit vouchers, and could then apply for a cash refund via our online form. These refunds were processed within 28 days.

“Customers with cancelled flight only bookings which were due to depart from 11 July onwards will automatically receive cash refunds. These refunds will be processed within 14 days.

“We’re really sorry to any customers who may have experienced delays in receiving their refund.”

A Virgin Atlantic spokesman added: "The huge volume of refund requests we have received, combined with the constraints on our teams and systems during the pandemic, has meant that refunds have been taking longer than usual to process, and we sincerely apologise for this.

"Since April, we have been focussed on making improvements wherever possible. We’ve boosted the size of the team dedicated to processing refunds five-fold, with over 200 people now directly involved. This has increased our capacity to process a greater number of refunds, more quickly and we continue to minimise the wait time for existing refund requests. "Thanks to the progress made, we are steadily reducing the maximum processing time for each new Virgin Atlantic and Virgin Holidays cash refund."

Which's findings came after the CAA reviewed airlines’ behaviour and identified several carriers that weren’t paying refunds ‘sufficiently quickly’, but opted not to take enforcement action after receiving commitments from the airlines to improve their performance.

The CAA said it will review any supplementary evidence provided by the consumer organisation.

“While our initial review has finished, we have been clear that we will continue to monitor performance and should any airline fall short of the commitments they have made to us, we will take further action as required."

Ryanair said: ”Ryanair has issued in excess of €750m in cash refunds, vouchers and free moves. We have cleared over 90% of the cash refund backlog and are making rapid progress on clearing all remaining refund requests.

"We call on the CAA to take urgent action against unauthorised third party screen scrapers and to ensure that they provide us with real customer information.

"Thousands of our customers are still being prevented from receiving their refund due to unauthorised third party screen scrapers who are providing Ryanair with fake email addresses or virtual credit card details that do not belong to our customers. Any customer who has booked with an unauthorised third party screen scraper should contact Ryanair directly."

Andrew Bartlett, chief executive of Scotland’s national consumer advice service consumeradvice.scot, said: “People across Scotland are still waiting for refunds from airlines for cancelled holidays.

“This is a reminder that consumer rights remain in place, and that legislation has to be adhered to by travel providers.

“Consumers can be offered vouchers and re-booking as an alternative to a refund, but they should not be misled or pressured into doing so – and in most cases a refund should still be an option that is easily available.

“The Civil Aviation Authority has been clear that it expects some airlines to improve how quickly they process refunds, and we’re still receiving queries relating to travel refunds going back as far as May."