The budget carrier has signed a deed of undertaking with the CAA to make improvements to the way in which it handles claims from passengers for costs incurred following flight disruption.

It follows months of negotiations with the CAA, which last December said Wizz was "clearly" the worst offender for having complaints escalated to alternative dispute resolution schemes or to the CAA’s own complaints team, and branded the carrier’s performance "unacceptable".

The CAA on Thursday (27 July) said Wizz had systematically failed to meet its passenger rights obligations, particularly with regards to rerouting passengers in the event of a flight cancellation or reimbursing passengers where they have had to make their own arrangements following a cancellation – such as rebooking onto another flight or having to find accommodation at short notice.

Wizz has committed to reviewing claims it received for replacement flight costs, transfers when replacement flights were via different airports, and care and assistance following flight disruptions.

It means any claims that were incorrectly rejected will be honoured; this applies to claims made with regards to flights due to depart from or arrive into any UK airport on or after 18 March 2022. Passengers with disputes pre-dating 18 March 2022 by up to six years will be able to request their claims be reopened and reexamined.

The CAA will monitor Wizz’s performance against its undertakings over the coming months, and will review a sample of the claims reexamined by Wizz. If it is found not to be honouring the letter or spirit of its commitments, the CAA has pledged to take Wizz to court.

Paul Smith, CAA joint interim chief executive, reiterated the authority’s stance that Wizz’s performance with regards to meeting its rerouting and care obligations was "unacceptable".

"We will continue to watch the situation closely to check passengers receive what they are owed and that Wizz Air’s policies have improved, so that consumers have a better experience if things go wrong," said Smith.

Wizz said it was not alone in facing "unprecedented" operational challenges last summer, driven by air traffic control disruption, airport constraints and "staff shortages across the whole supply chain".

Marion Geoffroy, Wizz Air UK managing director, admitted flights were "too often late or cancelled" and that claims took too long to process and pay after the volume "overwhelmed internal and external resources".

Wizz has made its own commitments to resolving all customers claims within 45 days, providing Wizz credit refunds within 24 hours and processing full refunds within seven working days.

One major criticism of Wizz when the CAA last intervened was its record on addressing a significant backlog of County Court Judgements, which fall outside the authority’s remit for action, and represent a last-ditch pursuit of recourse by consumers.

Wizz said on Thursday it had paid more than 70% of the outstanding CCJs "present in online records" with another 10% in progress. The remaining 20%, it said, were being identified and processed.

Geoffroy, though, warned summer 2023 would present additional challenges owing to air traffic control constraints. It follows a prolonged industrial action on the continent impacting ATC staffing, as well as a reduction in European airspace owing to the war in Ukraine.

"We expect this summer to be challenging for air traffic control, which will impact airlines," said Geoffroy. "While we cannot anticipate every disruption, we have invested more than £90 million to prepare for increased air traffic. We are confident that we have taken the right steps to better support passengers this summer season."

Wizz said it had made structural and organisational changes to address the situation, including:

• Adding spare aircraft capacity to support during disruptions;
• Increasing staffing at airports for operations and claim centres;
• Building increased time into crew rosters and between flights to make schedules more resilient;
• Doubling its operations team and split processes to be more efficient and focused on handling disruptions; and
• Implementing a new AI-based tool to forecast and mitigate possible disruptions

Wizz has also set out its efforts to improve customer experience this summer, which include:

• Launching a fully automated refund process;
• Providing 24/7 online support through a new chatbot called Amelia;
• Launching new customer service channel on Twitter @AskWIZZ;
• Contracting four new contact centres for increased customer service capacity;
• Increasing customer service agent training and quality checks to drive efficiency and quality of service; and
• Working closely with ground handling providers to increase number of staff on-the-ground