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Qantas customers to receive share of $20 million over cancelled flights: 'Egregious and unacceptable'

The airline is now facing a potential fine of up to $100 million for breaching consumer law.

Qantas has agreed to pay customers affected by recent flight cancellations. The airline admitted it misled people by advertising tickets for tens of thousands of flights it had already decided to cancel.

The Flying Kangaroo was also accused of cancelling thousands more flights without promptly telling passengers of its decision. The Australian Competition & Consumer Commission (ACCC) took Qantas to court and the airline will have to shell out $20 million to more than 86,000 customers.

The ACCC said the problematic flight cancellations occurred between 21 May 2021 and 7 July 2022.

Insert of Qantas tail next to passengers lining up for Qantas check in
Qantas has admitted it misled tens of thousands of customers over cancelled flights. (Source: Getty)

Have you been affected by these flight cancellations? Email stew.perrie@yahooinc.com

The airline was accused of advertising tickets for more than 8,000 flights that had been cancelled and there were a further 10,000 flights between May and July 2022 where ticket holders weren't advised that their journey had been cancelled.

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However, Qantas admitted that the misconduct went on until 26 August 2023.

“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,” ACCC Chair Gina Cass-Gottlieb said.

“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.”

The court decision applies to people who, between 21 May 2021 and 26 August 2023, booked, or were re‑accommodated on, a domestic or international flight scheduled to leave from 1 May 2022 until 10 May 2024

Qantas will pay $225 to domestic ticket holders and $450 to international ticket holders, which will be on top of any remedies consumers have already received from Qantas, such as alternative flights or refunds.

Customers will be contacted about the payment by July 10 and they will receive communication from the airline and Deloitte Australia, which is administering the payments on behalf of Qantas.

Ticket holders have been warned to be wary of scammers pretending to be from Qantas or Deloitte in order to get their personal information.

"Consumers should only provide their personal information through the official claims portal, and not to anyone else," the ACCC said.

Qantas tail of plane
Qantas will have to pay more than 86,000 a share of $20 million. (Source: Getty)

In addition to paying tens of thousands of customers a share of $20 million, Qantas could have to pay a fine five times that amount.

The ACCC will ask the Federal Court to impose a penalty of $100 million for breaching consumer law.

“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,” Cass-Gottlieb said.

“We note that Qantas has also agreed not to repeat this type of conduct in the future, and to make payments as soon as possible to the thousands of consumers who purchased tickets on flights that Qantas had already decided to cancel, or were re-accommodated onto these flights after their original flight was cancelled.”

In the wake of the court proceedings, Qantas said it will review its consumer compliance program and appoint independent auditors to ensure that program stays on track.

The auditors will provide reports to the Qantas board and to the ACCC.

The airline also said it will notify customers of cancelled flights as soon as practicable, and no more than 48 hours from deciding to cancel the flight. It has also promised 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 Jetstar.

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