Channelnews : qantas reaches a$120 million settlement over deliberately misleading customers about flight cancellations

Australian flag carrier Qantas has admitted that it misled consumers by advertising tickets for tens of thousands of flights it had already decided to cancel, and by cancelling thousands

more flights without promptly telling ticketholders of its decision, after court action by the Australian Competition and Consumer Commission (ACCC). The two sides reached an agreement on

Monday wherein the ACCC and Qantas will ask the Federal Court to impose a penalty of A$100 million on Qantas for breaching the Australian Consumer Law. The carrier has also agreed in a

court-enforceable undertaking that it will facilitate around A$20 million payments to customers who were sold tickets on flights that Qantas had already decided to cancel, or in some cases

who were reaccommodated on these flights after their original flights were cancelled. Specifically, it will facilitate payments to 86,597 consumers who, between May 21, 2021, and August 26,

2023, booked, or were re accommodated on, a domestic or international flight scheduled to depart between May 1, 2022, until May 10, 2024, after Qantas had already decided to cancel it.

Qantas will pay A$225 to domestic ticketholders and A$450 to international ticketholders. These payments are on top of any remedies these consumers already received from Qantas, such as

alternative flights or refunds. The ACCC had previously launched Federal Court action against Qantas in August 2023 alleging that, between May 21, 2021 and July 7, 2022, Qantas advertised

tickets for more than 8,000 cancelled flights. It contended that, for more than 10,000 flights scheduled to depart from May to July 2022, Qantas did not promptly notify existing

ticketholders that their flights had been cancelled. The ACCC added that the airline has now admitted that its misconduct continued from May 21, 2021, until August 26, 2023, affecting tens

of thousands of flights scheduled to depart between May 1, 2022 and May 10, 2024. Qantas will now contact affected consumers to inform them about the payment scheme by July 10, 2024 “We are

pleased to have secured these admissions by Qantas that it misled its customers, and its agreement that a very significant penalty is required as a result of this conduct. The size of this

proposed penalty is an important milestone in enforcing the Australian Consumer Law,” said ACCC Chair Gina Cass-Gottlieb. “Qantas’ conduct was egregious and unacceptable. Many consumers will

have made holiday, business and travel plans after booking on a phantom flight that had been cancelled. “We expect that this penalty, if accepted by the Court, will send a strong deterrence

message to other companies. Importantly, it demonstrates that we take action to ensure that companies operating in Australia communicate clearly, accurately and honestly with their

customers at all times,” added Cass-Gottlieb. Cass-Gottlieb noted in a statement on the ACCC website that Qantas has also agreed not to repeat this type of conduct in the future. Going

forward, the airline has also undertaken to notify customers of cancelled flights as soon as practicable, and no more than 48 hours from deciding to cancel the flight. It has also agreed to

stop selling cancelled flights as soon as practicable, and in any event within 24 hours of its decision to cancel. The undertaking also applies to its low-cost subsidiary, Jetstar. Qantas

will further review its consumer compliance program and appoint independent auditors who will monitor its compliance with the undertaking and provide reports to the Qantas board and the

ACCC. Qantas Group CEO Vanessa Hudson said, “When flying resumed after the COVID shutdown, we recognise Qantas let down customers and fell short of our own standards. We know many of our

customers were affected by our failure to provide cancellation notifications in a timely manner and we are sincerely sorry. We have since updated our processes and are investing in new

technology across the Qantas Group to ensure this doesn’t happen again.”