OVERSALES OF AIRLINE TICKETS

OVERSALES OF AIRLINE TICKETS & RECENT NATIONAL NEWS

There is a lot of buzz on news sites and social media regarding oversales and disgruntled passengers. If you have glanced at your news feed, Facebook or Twitter, you have undoubtedly seen recent news of a passenger being forcibly removed from an airline. The passenger was removed by law enforcement after the airline subsequently denied him boarding due to oversales for 4 crewmembers to be flown to their next flight destination. The passenger apparently did not comply with demands and requests by the crew resulting in the crew made the determination to get law enforcement to remove him.

The situation appears to be caused by poor planning of the airline. CNN reported the CEO of United claimed the crew members approached gate agents after the flight was fully boarded and informed the agent they needed to board the flight. Customarily, involuntarily denied boarding occurs at the gate, otherwise removal is only based on weight and balance issues or due to inappropriate behavior.

This article does not address those specific issues, but instead addresses the general overview of the law regarding oversales on airline flights. Oversales is when an airline sells more tickets than seats available in the hopes that enough passengers will cancel their flight or no show. Anyone that has flown recently knows that airlines flights are routinely full.

Undoubtedly, you have heard the gate agent request volunteers to change flights or even call specific passengers up after no volunteers were obtained. When everyone shows for the oversold flight, the airline must make arrangements to ensure carriage and must deny boarding at the gate to a few unlucky passengers. You have the right to be compensated if you are the unlucky passenger.

Airline operations are controlled by Federal Law. 14 C.F.R. §253.1 through §253.8 is referred to as Contract for Carriage. These statutes govern uniform disclosure requirements, preempt state requirements for terms incorporated by reference into contracts of carriage for scheduled passenger service (airline flights). The ticket must include a conspicuous notice that the terms incorporated are available at airports, ticket offices and by mail upon request. The ticket must also state that further information regarding limits of liability, claim procedures, right to change terms, refusal to carry and rights concerning delays. If notice is not provided, the price paid for ticket is refundable if passenger refuses transportation by carrier.

Oversales are governed by 14 C.F.R. §250.1 through §250.11 and apply to scheduled flights using aircraft with 30 or more passenger seats. 14 C.F.R. §250.1 provides definitions such as the following:

  • Class of service means seating in the same cabin class such as First, Business, or Economy class, or in the same seating zone if the carrier has more than one seating product in the same cabin such as Economy and Premium Economy class.
  • Confirmed reserved space means space on a specific date and on a specific flight and class of service of a carrier which has been requested by a passenger, including a passenger with a “zero fare ticket,” and which the carrier or its agent has verified, by appropriate notation on the ticket or in any other manner provided therefore by the carrier, as being reserved for the accommodation of the passenger.
  • Fare means the price paid for air transportation including all mandatory taxes and fees. It does not include ancillary fees for optional services.
  • Zero fare ticket means a ticket acquired without a substantial monetary payment such as by using frequent flyer miles or vouchers, or a consolidator ticket obtained after a monetary payment that does not show a fare amount on the ticket. A zero-fare ticket does not include free or reduced rate air transportation provided to airline employees and guests.

In the event a flight is oversold; the airline must ensure the least number of passengers holding confirmed space are involuntarily denied boarding. The airline must first request volunteers for denied boarding. A volunteer is a passenger who responds to the request and agrees to accept the airlines proposed compensation for relinquishing the seat. Unless agreed to freely, the passenger is deemed to be denied involuntarily even if they accept the compensation. The airline must disclose all material restrictions, blackout dates, and fees applicable to any free or reduced rate compensation provided.

However, the airline must inform each passenger solicited to volunteer for denied board whether that passenger is in danger of being involuntarily denied and if so, the airlines obligated compensation in the event of involuntarily denied boarding. Accordingly, if you agree but would be denied boarding anyway, you are entitled to involuntary denied boarding compensation in the event it is more than the voluntary compensation.

The airline may involuntarily deny boarding if there are not enough volunteers. The carrier shall establish priority rules and criteria for determining which passengers shall be denied boarding on an oversold flight. Those rules must reflect the criteria and rules of Part 250. The rules may not make, give, or cause any undue or unreasonable preference or advantage to any person or unjust or unreasonable prejudice or disadvantage in any respect. Boarding priority factors may include: 1) time of check in; 2) whether a seat assignment was provided prior to reaching the gate; 3) fare paid; 4) frequent flyer status; 5) disability or status as unaccompanied minor. The factors are not limited to this list.

If you are denied boarding, the airline must provide compensation unless you reach your destination within one hour. International flights are similarly governed but with different time restrictions as specified in 14 C.F.R. §250.5. The airline must provide 200% of fair with a $650 max if the destination will be reached an hour late but less than two hours late. If the destination is reached more than two hours later than original flight, the airline must give a 400% fare or max of $1,300.

The airline may offer free or reduced vouchers in lieu of cash if the value applies to the above amounts. Compensation is required even if passenger is a zero-fare ticket holder. In such cases, the fare is the lowest payment charged for a ticket in the same class of service on the flight in which the zero-fare passenger was denied boarding. The airline must also inform the passenger that the transportation benefit may be declined and the passenger may receive the cash/check payment.

It is likely that a traveler will experience Oversales at some point in their life. The laws and regulations act to give the airline an incentive to have you on a flight and to your destination in a timely manner. There is also incentive to volunteer. When volunteers are requested, step up and see if you are danger of being involuntary denied, and if not, see how much the airline will offer. I have had friends in the past that were provided the max compensation for an entire group which was more passenger than the airline needed.

Importantly, do not throw a temper tantrum if you are denied boarding. Not only does the ticket likely incorporate terms for the airline to deny boarding and the law allow for such denials, you may end up facing charges and being escorted by police. Just know your rights, request the written explanation and compensation.

The recent uproar regarding a passenger being taken off a flight is unique. Many people seem to have no problem with the action of the police removing the passenger after he refused to comply. However, many have issues with the removing of the passenger after he boarded to accommodate employees of the airlines. United’s posted terms of carriage can be found at https://www.united.com/web/en-US/content/contract-of-carriage.aspx.

Rule 25 subparagraph 25 provides United’s Boarding Priorities. Interestingly, it does not state that priority will be given to employees. Priority is giving to individuals with disabilities or unaccompanied minors under 18 or minors between ages of 5 to 15 who use the unaccompanied minor service. The remaining confirmed passengers are given priority due to passenger’s fare class, itinerary, status of frequent flyer program and time for which passenger checks in. Based on the information I have seen, it is questionable if United followed its own terms as the terms do not mention “high priority” to repositioning crewmembers. Priority was given to the repositioning crew and arguable gave unreasonable preference or advantage to those individuals.

We will have to wait and see the outcome of the DOT investigation regarding 14 C.F.R. §250.3 for the priority being giving to the employees and possible enforcement action. I suspect there will be an investigation into what was said to passengers in the request for volunteers and if the procedure and compensation was properly disclosed to the passenger. The passenger will likely file a complaint and United’s legal bill will be costly.

Regardless of the ultimate outcome, the recent event was bad for the passenger and United. The situation could have been completely avoided through better planning and/or better incentive for voluntary denied boarding. Maybe the employees need more flexibility to deal with issues or training. However, if you find yourself in this situation, remain calm and remember your rights. If the airline violates the terms or law, there are avenues to seek recourse, but those avenues are much better if you act in a rational and reasonable manner.

OVERSALES OF AIRLINE TICKETS
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