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Jetstar is anticipating a substantial fine in New Zealand for misleading customers about compensation claims.
The airline had pleaded guilty over accusations of discouraging customers from seeking compensation for delayed or cancelled flights, and of denying legitimate claims, in 2022 and 2023. It could be fined around NZ$2.5 million with a 25 per cent uplift, minus any potential discounts.
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On its website, Jetstar again apologised for its conduct, saying it took full responsibility for the “frustration, stress and financial impact” it caused. The airline had, as of March this year, refunzed around NZ$843,000, believed to have climbed over $1 million since then.
“Over the past two years, we’ve reviewed thousands of past claims and contacted customers impacted by these errors to ensure they receive the compensation they’re entitled to,” the statement read.
“For anyone who still feels they may not have received the correct compensation for a past flight disruption in Aotearoa, please get in touch with us [via our website] so we can review your case.
“We’ve made significant changes to prevent this from happening again, including updating our website and communications so New Zealand customer rights are clear, improving training and strengthening our claims review process.
“When things don’t go to plan, our customers can have assurance they will receive the compensation they’re entitled to.”
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”.
The New Zealand Commerce Commission in 2024 took Jetstar to court over the compensation issue, saying it “likely made false or misleading statements to consumers about their rights in aviation law”.
“Airlines have a responsibility to not mislead consumers about their rights in the event of cancellations or delays,” said Vanessa Horne, general manager for competition, fair trading, and credit, at the NZCC last September.
“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.”
The carrier last 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.”
