New DOT Rule Increases Bumping Compensation

Most of the press hailed the Department of Transportation’s (DOT) new proposal to increase bumping compensation as a huge victory for consumers. Actually, for most of you, the proposed new bumping compensation rules represent only a marginal gain, if any, and they fail entirely to treat the more serious consequences of bumping. In fact, the major benefits of the DOT proposals—and there are some very important benefits—relate to other elements of air service, not bumping. Because of the press coverage, however, I’ll concentrate on bumping this week; next week I’ll look at the additional benefits.

“Bumping” is the popular name for what airlines call “denied boarding,” or inability to honor a firm reservation. Airlines bump travelers for several reasons, most often “overbooking” to offset inevitable no-shows. When no-show forecasts are wrong, an airline must sometimes bump you even with a ticket and a firm reservation: {{{SmarterBuddy|align=left}}}The airlines’ first solution is “voluntary” bumping: enticing you into volunteering your seat in exchange for a voucher for future travel, a “free” flight, or some other lure. What you get is your negotiation with the airline: DOT doesn’t set it. Typically, voluntary bumping accommodates about 90 percent of overbooked travelers.

But when voluntary bumping doesn’t solve the problem, airlines must go on to “involuntary” bumping, for which the DOT establishes mandatory denied boarding compensation (DBC).

Current DBC rules call for no compensation at all if the airline can schedule you for arrival within one hour of your original time; 100 percent of the value of your ticket, with a $400 cap, if your revised arrival is between one and two hours late (four hours on international flights); and 200 percent of ticket value, with a cap of $800, if your rescheduled arrival is later. DOT proposes to adjust the dollar caps to $650 and $1,300, respectively. The press quickly picked up on those numbers—and little else.

Actually, for many of you, the dollar cap is irrelevant. The real ceilings are those percentages of your fare. Even now, not many of you travel on domestic tickets costing more than $400 each way ($800 round trip), so you’ll never see even the $400 or $800, let alone $650/$1,300. About the only time you’ll benefit from the new limits is on a long intercontinental flight.

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Other proposed changes will help you more in the real world. DOT is considering:

• Extending mandatory DBC to “zero fare” tickets such as frequent flyer awards and “free” companion tickets. In these cases, dollar compensation could be based on the lowest published fares, but compensation might also be in frequent flyer miles or comparable vouchers.
• Extending coverage from planes with at least 30 seats to planes with at least 19 seats.
• Improving disclosure about your alternatives and estimates of your chances of arriving at your destination within the one- or two-hour limits.

These improvements would certainly be welcome. But in these days of high load factors, getting you to your destination even four hours late might be difficult. To me, new rules should recognize that replacement flights might literally take days, not hours:

• If the airport where you’re bumped is more than 50 miles from your home and the airline can’t arrange a new flight the same day, it should be required to cover your accommodations and meals until it can get you a flight.
• Although airlines sometimes voluntarily transfer you to another line that can get you to your destination earlier, they aren’t required to transfer you. Transfer to another line (the old “Rule 240”) should be mandatory.
• If you’re bumped on the “going” potion of a round-trip, the remainder of your ticket should be re-classed as “open” and unrestricted so that you have access to any available seat, not just a seat in your designated fare bucket, and you can reschedule your return without penalty or fare adjustment.

DBC should extend to bumping for any reason within an airline’s control, not just overbooking.

Several other new DOT proposals could be more useful than modified bumping rules. I’ll cover them soon.

What do you think about the DOT’s new bumping rules? Share your thoughts by submitting a comment below!