Air Canada reverses course, offers refunds to some passengers with flights cancelled due to COVID

Air Canada has quietly changed its refund policy to allow some customers whose flights were cancelled due to the COVID-19 pandemic to recoup their cash but not passengers whose trips originated in Canada.

Customers with flights originating in the European Union, Switzerland and Iceland due to the pandemic are "entitled to receive a refund," states a document recently posted to Air Canada's website.

The post made on June 15, according to the metadata cites an EU regulation that grants passengers "the right to choose between reimbursement, rerouting or rebooking the flight at a later date" if their trip is called off by the airline.

"For customers with itineraries originating out of the EU, Air Canada has also recently added the option of a refund for non-refundable tickets. This decision follows extensive discussions among EU members of appropriate remedies given this unprecedented, global crisis and our own review of the applicable regulations in an evolving regulatory environment," Air Canada said in an email Thursday.

Customers with "non-refundable tickets" can choose between travel credit with no expiry date or convert their booking into Aeroplan points with 65 per cent more bonus miles, the airline said.

Months of backlash

Air Canada's shift makes it the second major Canadian carrier to offer refunds rather than credit to some passengers whose flights were cancelled as a result of the coronavirus crisis.

Earlier this month, WestJet Airlines Ltd. spelled out a broader refund offer in a document sent to travel agents that applies to flights with a U.S. or U.K. city as the destination or origin.

The change follows months of backlash as consumer advocates and thousands of passengers continue to seek refund for services paid for but never rendered.

An Air Canada executive told the House of Commons health committee on Mondaythe carrier has returned about $1 billion to customers who bought more expensive refundable tickets, but still has some $2.6 billion in advance ticket sales in its coffers.