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The New Zealand Commerce Commission (NZCC) will take Jetstar to court over allegations the low-cost carrier misled consumers.
The consumer watchdog is accusing Jetstar of discouraging customers from seeking compensation for delayed or cancelled flights, and of denying legitimate claims, in 2022 and 2023. Charges are expected to be filed shortly in Auckland District Court.
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Under NZ law, consumers impacted by delays or cancellations “within the airline’s control” are entitled to reimbursement for “reasonable costs” incurred as a result, including meals and accommodation as well as any other costs for the passenger to get to their destination, up to 10 times the ticket cost.
For international flights, the Montreal Convention also provides for reimbursement for these “reasonable costs”.
“Airlines have a responsibility to not mislead consumers about their rights in the event of cancellations or delays,” said Vanessa Horne, NZCC’s general manager for competition, fair trading, and credit.
“The Civil Aviation Act is clear that airlines have a responsibility to reimburse customers for loss caused by cancellations or delays on New Zealand domestic flights that are within the airline’s control.
“The Montreal Convention sets out consumers’ rights when travelling internationally, and consumers are entitled to reimbursements for costs incurred from delays and cancellations unless the airlines did all they could reasonably do to prevent the disruption.”
According to Horne, the NZCC believes Jetstar “likely made false or misleading statements to consumers about their rights in aviation law”.
“The Commerce Commission expects large businesses to take their responsibilities under the law seriously – they must honour their obligations to consumers,” she said.
In a statement, Jetstar apologised to customers and said it has “fully cooperated” with the NZCC’s investigation.
“We’re deeply sorry to have let our New Zealand customers down by errors made in assessing some compensation claims for disrupted flights in 2022 and 2023, as our operations restarted following COVID,” the airline said.
“Since becoming aware of this issue, we’ve been focused on making things right for our customers and improving our communication and processes.
“Late last year, we began reviewing past claims and reaching out to impacted customers to ensure they are correctly reimbursed, and we are continuing to work through this as a priority.”
The carrier earlier this year offered a mea culpa to affected passengers, saying on its website that its ability to provide remedies was disrupted by pandemic issues.
“The restart following the COVID-19 pandemic was a really difficult time for travellers and airlines in New Zealand and we acknowledge that our communication and customer service for New Zealanders could have been better. We sincerely apologise for letting customers down during this time,” the airline said.
“We are encouraging anyone who feels they may not have received adequate compensation for a New Zealand flight disruption to contact us to have their case reviewed.”
On its website, Jetstar is inviting NZ customers whose flights were disrupted before 7 May 2024 to have their historical claims reviewed, while those who have not yet made claims or experience flight disruptions after that date can make new claims for compensation.
