SAA has resolved an issue with the US Department of Transportation (DOT) by paying a $300,000 (around R5,4 million) civil penalty for passenger refunds delayed during the COVID-19 pandemic.
The DOT announced enforcement actions against SAA as well as against Lufthansa and KLM Royal Dutch Airways for “extreme delays” in the payment of more than $900 million (R16 billion) in passenger refunds for disrupted and cancelled flights during the pandemic.
Pete Buttigieg, US Transportation Secretary said: “When a flight is cancelled or significantly changed, you shouldn’t have to fight with the airline to get their money back – and we’re holding airlines accountable when they fail to give passengers the refunds that they’re owed.”
The DOT said it received more than 400 complaints that SAA had failed to make timely refunds. According to SAA, flights were significantly changed or cancelled due to the impact of the pandemic. The sheer number of requests, coupled with the fact that the company went into business rescue in December 2019, led to delays in refunding passengers.
“SAA has always contended that notwithstanding the challenges of Business Rescue and the COVID-19 pandemic, SAA took extraordinary steps during 2019-2022 to process refunds for passengers whose flights were cancelled or significantly delayed by the airline, not only in the USA but throughout SAA’s markets,” SAA said in a statement.
The airline revealed that it has paid out R2,2 billion between April 2021 and March 2023 in ticket refunds.
Koekie Mbeki, SAA’s Chief Legal Counsel said: “The intention of the parties was always to find an amicable way of closing this case. We look forward to normalising relations with our customers in the US and welcoming them aboard SAA when we resume flights to the Americas in the future.”
Lufthansa and KLM were each charged a civil penalty of $1,1 million (R20,5 million). Lufthansa explained that the delay in refunding passengers was due to the unprecedented level of refund requests, which the airline group said was equivalent to the workload of two-and-a-half months every day.
At the same time, KLM has said it adopted a customer-friendly ticket refund and exchange policy and provided $84,15 million (R1,57 billion) in refunds to passengers on non-refundable US flights.
