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Airline Overbooked Your Flight? Hold Out and You May Be Compensated Handsomely

Make the most of the situation.

Travel is a mess this year. Thousands are being affected by flight delays, cancelations, and lost luggage. Not to forget the snaking queues at airports and rising airfares. The problems are persistent across the U.S. During the July 4th weekend, more than 12,000 flights were delayed, and 1,100 were canceled, stranding thousands of passengers. But that has been the headline all summer, and it is likely to continue.

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A Summer of Woes

When the pandemic hit, airlines suffered major losses and laid off much of their workforce. The taxpayers in the U.S. bailed out 10 major airlines with a whopping $54 billion handout in three rounds. The conditions underlined that employees couldn’t be furloughed—the funding was promised to keep the staff employed and avoid a total collapse of the aviation industry. However, airlines found a loophole and offered compensation to their pilots to take voluntary retirement. Thousands left the workforce, and now there aren’t enough to take us places.

In the recent turn of events, airlines want to make money after the standstill caused by the pandemic. They’ve added flights to their schedules knowing that shortages may cause disruptions. Now passengers are facing the brunt even though we are paying more to fly (a surge in demand and rising fuel prices have raised airfares) because airlines and airports are woefully understaffed. From pilots to ground staff to security personnel to crew to baggage handlers, there just aren’t enough people. With travel demand going through the roof, airlines are under serious strain and amidst labor shortages, cancelations and delays have become an everyday hassle for fliers. 

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These are really choppy waters for airlines and they’re trying to handle this storm with pizza parties and apologies

What also isn’t helping the situation is the practice of overbooking flights by airlines. Although it is not illegal to oversell flight tickets, it’s another reason for delays, as airlines try to lure people on overbooked flights to take voluntary bumps. In order to make its schedule, Delta recently offered $10,000 in cash to every passenger willing to take a later flight. The overbooked plane was flying from Michigan to Minnesota, and the airline needed eight volunteers to take them up on their offer. They first started with a comparatively lowball proposal of $5,000 and increased it to $10,000 as a desperate bid to avoid delay or cancelation, which has plagued the airline all summer. 

It’s true that such a huge amount isn’t presented to passengers regularly, but airlines can compensate you well for your troubles if you give up your seat because it saves them much, much more in refunds later.

Bumping Rights

Airlines oversell their flights. It’s a routine way to make up for no-shows. But even if they’re fully booked out, there are cases when a seat is needed for crew members or a Federal Air Marshal. In such cases, the airline bumps people off—voluntarily and involuntarily. The U.S. Department of Transportation states, “Before an airline forces a passenger to give up his/her seat due to overbooking, the airline must ask passengers on the flight if they are willing to give up their seat voluntarily in exchange for compensation.”

DOT has described rights of passengers in detail after an incident that sent shockwaves across the world five years ago. 

In 2017, a video of a passenger being dragged out of a United Airlines flight went viral. Dr. David Dao suffered multiple injuries, including a concussion, because he refused to de-board the plane so United crew could be accommodated on the overbooked flight. The bloodied face of an innocent, paying passenger being violently removed from the aircraft became the cause of many policy changes. Airlines, including United, promised to reduce overbooking, and United and Delta increased maximum compensation for passengers voluntarily giving up their seats to up to $10,000. 

Don’t take the first offer—if airlines need a couple of people to give up their seats, they will raise the price in this reverse auction.

Airlines now try to persuade passengers to willingly surrender their seats if a flight is overbooked. They negotiate with fliers and there’s no cap on how much they can offer in cash or vouchers. So, if you find yourself in such a situation, make sure to make a high bid for taking a later flight and ask for cash instead of a voucher (which comes with an expiration date). While negotiating, talk to the airline about the next flight, and calculate what the delay would cost you in terms of food, lodging, and transfers—chances are that the airline will pay for it all. Don’t take the first offer—if they need a couple of people to give up their seats, they will raise the price in this reverse auction.

Airlines ask for bids for passengers and even if you have made a low bid, they pay the highest to everyone. Just this month, a traveler flying to Iceland on an overbooked Delta flight was given a $4,500 voucher to give up his seat and fly later. The bid started at $500 and went up exponentially. Delta allowed the flier to pick from a range of gift cards.

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If there are no takers for giving up seats for compensation and another flight, airlines select passengers and involuntarily bump them off. This selection depends on your check-in time, frequent flier status, ticket price, and cabin class. Airlines can’t use your ethnicity or race as a reason, and normally, you are not bumped off if you have already boarded. Passengers are involuntarily denied boarding if they are unruly or security risk without any legal requirement for compensation.

If you are unlucky enough to be involuntarily denied boarding due to overbooking, DOT has a list of conditions, and you are entitled to Denied Boarding Compensation as well as a place on the next available flight. You are eligible for compensation if you have a confirmed reservation, if you checked-in on time, if you arrived at the gate on time, and if the airline can’t get you to your destination within an hour of the original flight’s arrival time.

According to the website, “Passengers who are denied boarding involuntarily due to oversales are entitled to compensation that is based on the price of their ticket, the length of time that they are delayed in getting to their destination because of being denied boarding, and whether their flight is a domestic flight or an international flight leaving from the United States. This is called ‘denied boarding compensation’ or ‘DBC’ for short.”

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There is a slab system for domestic and international flights and you should keep this page bookmarked for future use. For example, for an over two hour delay on arrival on a domestic flight, you are entitled to 400% of one-way fare, limit to $1,550. But the airline can give you more should there be a need. And, the rules also highlight that the airline must offer passengers compensation on the same day at the airport, or within 24 hours.

DOT mentions that those who are involuntarily bumped off should get monetary compensation. You don’t have to accept vouchers if they’re offered. The airline also needs to give you a written statement of your rights as well as the process that led to the decision of bumping you off.

Note that bumped passengers don’t get recompensed for aircraft changes, weight and balance issues, or downgrading, DOT specifies.