What to know about airline refunds, delays as global IT outage causes ‘mass chaos,’ expert says

Major airlines like United, Delta and American Airlines grounded flights Friday morning amid a global IT outage impacting their operations, triggering delays for travelers.

“You can imagine the mass chaos unfolding everywhere,” said Eric Napoli, chief legal officer at AirHelp, which helps fliers claim compensation for delayed or canceled flights.

“Any kind of shutdown, the bottleneck [it has] on so many flights is incredible,” he added.

Passengers impacted by flight disruptions may be entitled to a refund, hotel or meal voucher or other remuneration.

But it largely depends on the airline, travel experts said.

“There is this kind of gray area where we’re at the mercy of what the airline’s policy is,” Napoli said.

Experts are also divided as to whether the outage constitutes an event within or outside of airlines’ control — an important factor in determining whether a customer is entitled to any sort of financial compensation.

There’s really only one guarantee about an airline’s financial duty: Customers are owed a refund of the ticket price (and fees) if the carrier cancels their flight — regardless of the reason — and they choose not to travel on an alternate flight, according to the U.S. Department of Transportation.

This is true even for non-refundable tickets.

That means customers would get cash back on a canceled flight if they opt not to fly, and also decline an alternative like a rebooking or flight voucher, said John Breyault, travel expert at the National Consumers League.

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Passengers are also entitled to a refund for “significant” schedule changes or delays, and opt not to fly, the DOT said.

However, the DOT doesn’t define “significant.” That determination is based on factors like length of delay and flight and particular circumstances, the agency said.

Starting Oct. 28, airlines will have to “promptly” and automatically pay refunds to customers, due to a Biden administration rule issued in April. That rule also defines “significant” itinerary changes, including delays of three hours for domestic flights and six hours for international flights.

However, since the rule takes effect in October, it doesn’t help customers affected by Friday’s outage. They may have to “jump through hoops with the airline” to claim a refund, Breyault said.

It may be yet more challenging for fliers who bought a ticket through a third-party booking site, and not directly with the airline, experts said.

Customers will likely have to transact with that intermediary for any kind of financial compensation, said Napoli.

Expedia, for example, said on social media Friday morning it was “experiencing high call volume and long wait times due to a global IT outage. If your needs are not urgent, please consider postponing your call and chat to avoid long hold times.”

However, many travelers affected by Friday’s outage need or want to fly to their end destination, meaning they wouldn’t be entitled to a refund.

There are generally no federal guarantees for travelers in such cases. This is where specific airline policy comes into play.

“The airline is going to fly you to your destination, on the next available flight,” said Sara Rathner, a travel expert at NerdWallet.

“What might differ [between airlines] is how much compensation you might get after the fact, not just for the delays but any other costs you might incur,” she added.

The Transportation Department website outlines carriers’ promises to customers in the event of cancellations or delays longer than three hours. (Its dashboard outlines policies for 10 large U.S. airlines and their regional operating partners, which account for 96% of domestic passenger air traffic.)

Airlines are “required to adhere” to these promises, the agency said.

All airlines commit to rebook passengers on the same airline for free. Some will do so on a partner airline, and most will offer a meal and/or a hotel stay for long delays or cancellations, Napoli said.

However, airlines’ commitments only apply to circumstances within the airline’s control.

A “controllable” flight cancellation or delay may be due to maintenance or crew problems, cabin cleaning, baggage loading or fueling, for example, according to the Transportation Department.

It’s generally harder for consumers to get any sort of compensation for uncontrollable events like weather, Breyault said.

Experts seem to disagree on whether Friday’s outage would be deemed to be within airlines’ control.

CrowdStrike, a cybersecurity firm, experienced a major disruption on Friday linked to a tech update. That impacted organizations like Microsoft, which scrambled to restore apps and services used by a huge number of firms — including airlines.

“This seems a few degrees removed from the airlines,” said Rathner of NerdWallet. “It’s software they use as part of their operations.”

However, airlines choose their vendors, Breyault said. One could argue “a failure by one of their vendors is controllable,” he said.

“I think it’ll be something consumers should keep an eye on,” Breyault said.

Passengers should keep any receipts for unexpected costs incurred due to a delay or cancellation — like those for lodging and meals — for financial proof when filing a claim with an airline or travel insurer, for example, Rathner said.

“You may get some of that money back, so don’t throw those receipts away,” she said.