Bumping airlines to count the cost

U.S. Transportation Secretary Ray LaHood has announced plans to bump up the cost to airlines for bumping passengers on overbooked flights. The proposals also include greater transparency in pricing and fees as well as tweaks to the recently-enacted tarmac delay limits. The actions are encouraging for airline passengers, so how are the airlines reacting?

The U.S. Department of Transportation (DOT) is outlining new measures that will strengthen airline passenger protections beyond the recently-enacted tarmac delay limits. The proposed rules are intended to:

increase compensation for passengers involuntarily bumped from flights allow passengers to make and cancel reservations within 24 hours without penalty
require full and prominently displayed disclosure of baggage fees as well as refunds and expense reimbursement when bags are not delivered on time
require fair price advertising
prohibit price increases after a ticket is purchased
mandate timely notice of flight status changes

The rule limiting tarmac delays for domestic flights to 3 hours before passengers are returned to the gate also required U.S. airlines to create and publish their contingency plans for lengthy tarmac delays

The most recent DOT proposal will expand the requirement to include non-U.S. airlines and operations at small and non-hub airports. Additionally, the DOT will require more data about tarmac delays. Currently only the 18 largest airlines operating domestically in the U.S. report this data to the DOT. The new rules will expand the collection of tarmac delay information to all U.S. and foreign carriers operating aircraft of 30 or more seats on flights to and from the United States. This will also include charter flights.

One of the more prominent changes deals with compensation for passengers who are denied boarding due to overbooking of flights. Involuntarily "bumped" passengers are currently entitled to USD400 if the airline can get them to their destination within two hours of the original schedule for a domestic flight or four hours for an international flight. If not, the compensation goes up to $800. According to the DOT, the proposed rule would quickly increase these limits to $650 and $1,300, respectively, and thereafter adjust the amounts for inflation every two years.

The new rules also require carriers to provide special notice any time baggage fees are increased, and to notify passengers buying tickets whether they must pay to check up to two bags, according to the DOT press release.

There will be a 60 day comment period for interested parties before the rules are finalized and implemented later this year.