Air New Zealand has clarified its refund policy after passengers booked on cancelled flights to Norfolk Island were told they were not entitled to a refund.
Two weeks ago, Air New Zealand temporarily cancelled all flights from Australia to Norfolk Island after the Australian government suspended quarantine-free flights from New Zealand to Australia (these have since been reinstated). Due to the changed border restrictions, Air New Zealand said its crew would have been unable to operate the Australian domestic flights without first undergoing 14 days of hotel quarantine. This left hundreds of Australians stranded and prompted Qantas to run five rescue flights between Brisbane, Sydney and Norfolk Island last week.
AFF member Qantas747 was one of the passengers booked to travel from Brisbane to Norfolk Island, with a return flight to Sydney, during the week Air New Zealand suspended all flights. This member says they were not offered a refund by the Air New Zealand contact centre, despite no alternative flights being offered.
I was booked to go on the 28th, and come back on the 1st, for a quick trip over. No refund or change of flight offered – they were quite firm about the fact that the only option was a flight credit, which we had no choice but to take.
– Qantas747, 1 February 2021
This customer was eventually given a full refund, but only after Australian Frequent Flyer contacted Air New Zealand.
An Air New Zealand spokesperson confirmed that customers booked to Norfolk Island were orginally offered either a travel credit or to change their travel dates, but that the airline has since decided to offer refunds to passengers booked on the cancelled Norfolk Island services as a “gesture of goodwill”.
While this is a good outcome for those affected passengers, Air New Zealand maintains that it is not legally required to refund passengers where a flight is cancelled for reasons outside the airline’s control. The airline argues that events such as the recent Norfolk Island cancellations are due to COVID-related restrictions, and are therefore beyond their control.
Since last year, this policy has left many tens of thousands of Air New Zealand customers with cancelled flight bookings unable to access refunds. Many of these customers have instead been issued with flight credits that will expire by the end of this year.
According to section 15.5 of Air New Zealand’s conditions of carriage, the airline is entitled to issue a credit instead of a refund under some circumstances:
Sometimes the cancellation, failure or misconnection is because of circumstances beyond our control. For example, the following circumstances may be beyond our control: a weather event, public health event (including epidemic / pandemic), airport or facility closures, medical emergencies, strike, terrorist act, governmental, regional or local authority restrictions, change in law.
In these cases, you may be entitled to a travel credit instead of a refund, which will be valid for 12 months from the date your Ticket was originally issued (or in certain circumstances an extension may be separately agreed with us). This credit will be for the value of the unused non-refundable part of your Ticket.
We may deduct a reasonable service fee from the credit amount to cover our administration costs.
– Air New Zealand Conditions of Carriage
According to New Zealand’s Commerce Commission, Air New Zealand was the “most complained about company” in New Zealand last year. A majority of those complaints were from customers who wanted refunds for cancelled flights or had problems trying to change their flights.
Air New Zealand eventually refunded tickets covered by United States laws, which require airlines to refund cancelled flights, but only after a complaint from Consumer NZ. The airline says it also issues some refunds on compassionate grounds.
Consumer advocates in New Zealand have recently been pushing Air New Zealand to review its “hardline refund policy” and clarify how long passengers’ travel credits will be honoured.
Air New Zealand’s website says that passengers can “book with confidence”, as the airline is waiving change fees or offering credit vouchers for any flights booked until 31 March 2021. But this only covers flights until 31 March, and doesn’t guarantee a refund.
Unlike Air New Zealand, Qantas’ policy is to offer refunds for any flights cancelled by the airline. Once New Zealand’s international border reopens, this will certainly be something worth considering when booking trans-Tasman travel. Even though you might have to wait a while to get your refund from Qantas, you will at least get one!