Qantas admits misleading consumers over canceled flights

Australia’s national airline, Qantas, has admitted to misleading customers by selling tickets for flights it had already decided to cancel.

This admission follows legal action by the Australian Competition and Consumer Commission (ACCC). These include allegations by the consumer watchdog that the airline advertised ticket sales on flights known to be canceled.

Under a settlement announced today, the ACCC and Qantas will ask the Federal Court to fine Qantas $100 million for breaches of Australian Consumer Law.

Qantas has agreed to significant compensation for affected passengers and committed to improving its communications practices to prevent future deceptive behavior.

Heavy penalty and consumer compensation

The ACCC accused Qantas of advertising tickets for more than 8,000 flights between May 2021 and July 2022 that had already been cancelled.

Recently, Qantas admitted that this misconduct continued for a prolonged period. It essentially impacted tens of thousands of flights scheduled to depart between May 2022 and May 2024.

To address this widespread problem, the airline will face a $100 million fine for breaching Australian Consumer Law.

Most importantly for affected passengers, Qantas agreed to a compensation package valued at around $20 million.

Qantas is compensating more than 86,000 consumers who booked or were booked on flights the airline had already canceled. Domestic passengers can expect $225 each, while international passengers will receive $450.

Summary of the agreement

As part of the agreement with the ACCC, Qantas:

• admits to misleading consumers about flights it decided to cancel.
• undertakes to the ACCC to make payments to customers.
• undertakes not to engage in this type of behavior in the future.
• will make joint submissions on the proposed $100 million penalty to the Federal Court.

The court will decide the amount of the penalty at a future hearing. Qantas also agreed to contribute to the ACCC’s costs.

Improved communication and transparency

Beyond financial sanctions and compensation, the agreement between the ACCC and Qantas provides for crucial reforms aimed at preventing such deceptive practices in the future.

Qantas has committed to significantly improving communication with passengers regarding flight cancellations.

This includes notifying customers within 48 hours of a flight cancellation decision and immediately removing canceled flights from their sales channels. Importantly, these reforms also apply to Qantas’ budget subsidiary, Jetstar.

To ensure compliance with these reforms, Qantas will be subject to an independent audit. This audit will monitor the airline’s practices and report its findings to the Qantas board and the ACCC.

This monitoring mechanism provides consumers with additional assurance that Qantas is serious about improving communication and transparency.

Request compensation

The airline will proactively contact customers affected by its deceptive practices by July 10, 2024. This communication will likely be via email and text message, directing individuals to a secure online portal to seek compensation.

As with any compensation program, there is a risk of potential scams. Consumers should exercise extreme caution and only provide personal information through the official complaints portal designated by Qantas.

Summary

“We are pleased that Qantas has admitted to misleading its customers and accepted that a very significant sanction is required as a result of this conduct.”

“The scale of this proposed penalty is an important step in the enforcement of Australian consumer law. » ACCC President, Gina Cass-Gottlieb said.

This agreement represents a significant step forward for consumer protection in the Australian airline sector. The heavy penalties and compensation send a strong message to Qantas and other airlines about the importance of transparent and ethical business practices.

Passengers can expect improved communication and a more reliable ticketing system from Qantas in the future.

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