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Travel agency Flight Centre has drawn criticism for charging $300 per passenger in administration fees for involuntary cancellations. Customers that booked flights that have now been cancelled by the airline, due to the COVID-19 shutdown, are being slugged the hefty Flight Centre cancellation fee – even if the airline itself is providing a full refund.
Flight Centre charges a cancellation fee – on top of any airline fees or penalties – when a customer decides to cancel flights booked through the agency. Such fees are a normal part of any travel agency’s terms and conditions. But some Australian frequent flyers believe it is unfair for Flight Centre to also charge this fee when the customer has not decided to cancel – rather, the airline has cancelled and refunded their booking.
In cases where an airline is charging a penalty to cancel flight bookings, Flight Centre is charging its own cancellation fees in addition to any airline fees.
Flight Centre is not charging any fees to assist customers with retaining the value of their booking as an airline credit, where this is being offered. Flight Centre’s own cancellation fees are also being waived for customers that choose to keep the value of their flight or cruise booking as a Flight Centre credit.
Flight Centre’s cancellation policy
This is what Flight Centre’s coronavirus policy states for international flight or cruise bookings that have been cancelled:
If you do not accept a credit with an airline or travel provider your options are:
- If you choose to keep the full amount of your booking (less any supplier fees which can be up to 100% of the booking value) on file with Flight Centre to spend on travel within 12 months of 1st July 2020, we will waive our own cancellation fees.
- If you want a refund for cancellation that is forced (by the supplier), we will apply our standard $300 cancellation fee per person, as per Flight Centre’s Terms and Conditions. Please note that the supplier fees will also apply.
Please note that supplier cancellation terms and fees may differ and can be up to 100% of the booking value. No refunds can be issued until we have received final refunds from our suppliers.
Flight Centre goes on to reference the ACCC’s COVID-19 information for consumers in justifying its policy.
It is important to remember that Australian Consumer Law overrides anything that is stated in the terms & conditions of Flight Centre, or any other Australian business. The Flight Centre Booking Terms and Conditions even explicitly state that all change and cancellation fees are “subject to your refund and remedy rights under the Australian Consumer Law”.
Flight Centre’s cancellation administration fees (charged in addition to supplier fees) are $50 per passenger for domestic and trans-Tasman bookings, and $300 per passenger for all other international bookings.
AFF members respond
Here is what some Australian Frequent Flyer members had to say:
I’m not exactly sure if FC taking $300 for a fee if the airline cancels is legal. Time will tell. There’s an awful lot of very unhappy folks and I think there will be legal action at some stage, or a review by one of the regulatory authorities.
Very keen to hear the outcome of this behaviour of FC charging cancellation fees on involuntary cancellations. I’m wonder how we (consumers) can prevent being suckered in the future (once the crisis is over). I’m worried people will forget how they were treated by companies when things went into crisis.
Aunt Betty cancellation fees
One AFF member is also having problems with cancelling a booking made via the Aunt Betty website, which is owned by Flight Centre Travel Group. Aunt Betty is adding its own cancellation fee of $250 per passenger where the airline has cancelled the flight, or a $55 “processing fee” if the customer decides to rebook or retain the value of their booking as an Aunt Betty voucher.
To make matters worse, Aunt Betty is currently “prioritising” customers that are due to fly in the next 24 hours – meaning other customers are unable to make contact.
Is this legal?
A spokesperson for the Australian Competition & Consumer Commission (ACCC) told Australian Frequent Flyer that it is “aware of the concerns raised by many consumers about the imposition of cancellation or administrative fees by Flight Centre”.
“We have been engaging closely with Flight Centre and written to them regarding our concerns,” the ACCC spokesperson said.
A Flight Centre spokesperson told Australian Frequent Flyer that the travel agency is comfortable its position is inline with Australian Consumer Law.
Like many airlines and travel agencies, Flight Centre has been significantly impacted by the coronavirus situation with around 30% of Flight Centre Travel Group’s stores around Australia closing. On Monday, the company announced that it has secured $900 million in additional funding to ensure its ongoing viability.
Join the discussion on the Australian Frequent Flyer forum: Flight Centre refunds for cancelled flights
