The CAA could take enforcement action against Virgin Atlantic over its slow payment of refunds to passengers on flights cancelled due to the Covid-19 pandemic.
The aviation regulator looked at the refund efforts of 18 airlines either based in the UK or who carry significant passengers from the UK. In the review, the CAA said its actions had led to refunds being paid faster.
The CAA said it was “not satisfied” with Virgin Atlantic’s policy of having a maximum wait time for refunds of 120 days for consumers and asked the airline for commitments to reduce this processing time.
“Virgin Atlantic has committed to reducing the maximum time taken to process a refund and it expects to process all claims made in August within 80 days, all claims made in September within 60 days, and all claims made in October within 30 days,” said the CAA in its report.
“We will continue to work with Virgin Atlantic and push them for further improvements to the timescales. Given the extended timescales, even in September and October, we will be monitoring Virgin’s performance particularly closely and will consider the use of formal enforcement powers if necessary.”
Corneel Koster, Virgin Atlantic’s chief customer officer, said: “The huge volume of refund requests we have received, combined with the constraints on our teams and systems during the pandemic, has meant that refunds have been taking longer than usual to process, and we sincerely apologise for this.
“Thanks to the progress made, we are steadily reducing the maximum processing time for each new Virgin Atlantic and Virgin Holidays cash refund.”
Other airlines “not processing refund requests sufficiently quickly”, according to the CAA, included low-cost carrier easyJet and Ryanair, as well as tour operator Tui.
All three airlines have been asked to provide “commitments to reduce the time taken to process refunds”
Easyjet has now increased staffing in its call centres and extended opening hours allowing it to process refunds in less than 30 days.
While Ryanair earlier this month published a set of commitments on its website including that 90% of its refunds backlog would be cleared by the end of July.
Initially, Tui automatically issued a credit note for the value of the flight with the customer having to wait 28 days before requesting a cash refund, which took another 28 days to process. Now Tui is “automatically commencing the cash refund process once it notifies passengers of the cancellation of their flight”.
British Airways was found to have a “relatively small” backlog of refund requests, which were being processed “relatively quickly”.
But the CAA added there were consumer complaints about their difficulties in getting in touch with BA to ask for a refund.
“In its own sample calls to the airline, the CAA has also been unable to speak to an agent to discuss refunds, with its calls terminated following a recorded message,” said the regulator.
“British Airways has now made some changes to its customer helpline to ensure calls are no longer terminated after a recorded message.”
Jet2 was one of only three airlines – along with American Airlines and United Airlines – found to be providing refunds “promptly” and did not have significant backlogs.
The CAA also identified several airlines that did not initially appear to be offering cash refunds, including Air Canada, Etihad, Turkish Airlines and Malaysia Airlines. Although, this situation has improved recently and continues to be monitored by the CAA.
Richard Moriarty, chief executive of the CAA, said: “The airlines we have reviewed have responded by significantly enhancing their performance, reducing their backlogs, and improving their processing speeds in the interests of consumers.
“Although we have taken into account the serious operational challenges many airlines have faced, we have been clear that customers cannot be let down, and that airlines must pay refunds as soon as possible.”