Airlines in Administration: Your Rights
With an increasing amount of volatility in the business world, many companies are facing an uncertain future. It can be a worrying time if while you are on holiday, the airline responsible for transporting you to and from your destination goes into administration and ceases trading. Your rights when the airlines in administration will vary depending on many different factors. The rights of an air traveller when an airline has gone bust vary. In general, your rights will depend on how the flight was booked.
Tour Operator or Travel Firm
If you booked the holiday through a travel company or tour operator as a package holiday, they are obliged from a legal perspective to hold an Air Travel Organisers Licence (ATOL). It is recommended that you always book a holiday through an ATOL protected firm. You can check whether the firm holds a licence by checking with the Civil Aviation Authority (CAA).
When you book a package holiday through a tour operator or travel firm, it usually follows your holiday will be protected under ATOL. It is important however to be absolutely clear on what constitutes a package holiday. A holiday can be described as a package holiday if it consists of two or more elements such as a flight to your holiday destination and your hotel accommodation.
If you book a package holiday through a travel firm or tour operator, it is their responsibility to ensure that you arrive home at the end of your holiday. If the airline ceases trading, the travel firm or tour operator will need to make the necessary arrangements to ensure that you can get home and at no additional cost to you.
If the holiday is covered by ATOL, your travel representative should have told you about this at the time of booking. It is not uncommon for you to be issued with an ATOL certificate and it is good practice that you take this with you when you travel.
If you book the flight and accommodation separately the situation can become slightly more complex. You may or may not be protected under ATOL in this case. It depends on a variety of factors. If you are covered, you will have received an ATOL certificate when you booked your flight. Where you received the ticket for your flight within 24 hours of booking, it usually follows that you wouldn’t be ATOL protected.
If your full holiday or your flight only are covered by the ATOL protection scheme and the company you booked the holiday with cease trading, it is up to the Civil Aviation Authority to make the necessary arrangements to get you home at the end of your holiday.
There will be no cost to you for this alternative flight. Usually you will be able to return home on the same day as intended but there may be a slight variation in your flight time or sometimes you may be flown to a different arrival airport in the UK. In this case, the CAA will make arrangements to transport you back to the airport you departed from.
If you do need to fly to an alternative airport, the Civil Aviation Authority will make arrangements for a coach to complete the remainder of your journey. Again, there will be no cost to you for these arrangements.
No ATOL Protection
If your flight isn’t covered by ATOL protection the situation becomes a little more complex when airlines in administration. When you booked the flight, if you used a credit card and the flight was more than £100 you may be able to request a refund from your credit card provider.
Credit card providers will only issue a refund for an unused flight and it is very unlikely that you will be able to claim compensation for any additional fees that you had to pay. Alternatively, if you purchased travel insurance there is a small chance that you may be covered, but a number of policies include a clause which excludes this type of situation.
When airlines in administration, you may be able to claim the cost of the flight from the administrators, but the process is lengthy and the chances of success are very small.
Flights Booked Directly
Flights that are booked through the airline directly are rarely covered by ATOL. If your flight isn’t covered you will need to make your own arrangements to travel home. This means that you will have to pay for the return flight with an alternative airline, take care of finding an alternative flight and meeting the additional costs that you may incur.
It may be that an alternative flight isn’t available on the same day so you might have to either cut your holiday short or pay for accommodation for another few days until you can secure a new flight. It will be up to you to find these additional expenses.
The importance of checking that your holiday and flight are covered by ATOL cannot be stressed enough. Some holidaymakers have had to pay a significant amount of money, not only to get themselves home, but to find accommodation until their new flight can be arranged.
When you travel, make sure you take your ATOL certificate with you so it can be shown if it is necessary. Even if the airline you are travelling with does go into administration and stops all flights it is possible, through the CAA to arrive home with minimal disruption to your holiday.
About the Author
This article was written by a member of the Expert Answers team and posted by Lloyd Barrett, Admin & Customer Services Manager for online advice service Expert Answers. Expert Answers provides legal advice to users in the UK who post a question on their secure platform.