JetBlue To Pay Bill Of Rights

Following a Valentine's Day massacre of a storm that caused delays and cancellations affecting more than 100,000 customers, JetBlue Airways last month issued what it calls its Customer Bill of Rights and announced contingency plans for similar situations in the future. Analysts, buyers and consultants expect other airlines to offer similarly upgraded policies to help thwart—or ease—traveler inconveniences due to delays or cancellations, and the U.S. House and Senate are expected to weigh bills that would federally mandate airlines to adopt further measures to mitigate the woes of stranded passengers.

With flights restored and attempts to mend its reputation in progress, JetBlue is striving for the customer bill of rights—not the debacle itself—to be its legacy. JetBlue CEO David Neeleman called the customer bill of rights an "accountability document" that he said would be retroactive to Feb. 14 and instituted in the event of future uncontrollable events. JetBlue's program of customer promises and monetary compensation goes beyond current federal requirements to offer customers on canceled flights full refunds or reaccommodation as well as vouchers for future travel.

It took nearly a week for JetBlue to begin operating at full schedule and reinstate more than 1,000 canceled flights, but following the snafu the carrier said bookings remained on track with prior estimates. Calyon Securities airline analyst Ray Neidl said it likely was a one-time event, and "the airline was caught off guard and reacted poorly to the crisis." Neidl added: "It was a combination of bad weather, bad luck, bad handling and bad PR."

"If there's anything that came out of this debacle with JetBlue, it's that so much focus is being put upon this that maybe the airlines will take care of it," Sybase Inc. manager of purchasing, global card and travel Patricia Carlin said. "The thing JetBlue is doing is useful as a marketing tool. If that draws business, maybe the other airlines will follow so they're not left out in the cold. They can leave their passengers out in the cold—but they won't be."

The Air Transport Association of America said each of its airline members, including American, Continental, Delta, Northwest, Southwest, US Airways and United, "will continue to review and update policies to assure the safety, security and comfort of customers." ATA said it is working with the Federal Aviation Administration to allow "long-delayed" flights to return to the gate without losing the aircraft's spot in the departure queue if passengers wish to disembark. ATA also asked the Department of Transportation to review airline and airport contingency plans to "effectively address weather emergencies in a coordinated manner and provide passengers with essential needs."

Calyon Securities' Neidl said JetBlue's new policy is causing domestic carriers concern, as they now feel compelled to follow with comparable protections and recompense, "which could turn out to be much more costly than expected." Carriers are concerned that if they don't do it themselves, Congress will force them, he said.

In the days following the JetBlue debacle, Rep. Mike Thompson (D-Calif.) and Sen. Barbara Boxer (D-Calif.) said they plan to introduce such bills. According to Thompson, the passenger bill of rights would hold some of the same concepts outlined by ATA, but with the stamp of government regulation—a move the airlines, including JetBlue, do not support. Like the airline lobbying group, Thompson called for passengers to have means to exit a plane if a flight is grounded for more than three hours, and that necessities—"food, safe drinking water, sanitary bathroom facilities, adequate ventilation and a reasonable temperature"—should be standard on delayed flights. The bill also would mandate airlines to "frequently" update passengers on status and cause of delays, to disclose information on "chronically delayed or canceled flights at the time of ticket purchase, to return checked bags to customers within 24 hours and "to make information on the lowest fares readily available to the traveling public."

ATA president and CEO James May said, "A rigid, national regulation would be counterproductive, and could easily result in greater passenger inconvenience."

Neeleman said proposed congressional legislation that forces airlines to allow customers to disembark after three-hour departure delays would create more problems than it would solve and not serve customer interests.

E. Christopher Murray, an attorney with Reisman, Peirez and Reisman, a Garden City, N.Y., law firm, said that U.S. carriers likely would preemptively adopt higher standards on their own—without government interference. "As Congress is revisiting the issue of regulating the airlines and how they operate," he said, "I would expect all airlines to voluntarily adopt a customer bill of rights like JetBlue to avoid direct government action."

Sybase's Carlin said there should a standardized course of action that an airline takes when travelers are inconvenienced by delays, cancellations or being grounded on the tarmac. Carlin said decisions of customer care in such times largely are left to gate agents at the airport or the flight crew.

"Right now, it's totally subjective," she said. "I give advice to travelers on what to do, but it seems the only way they're taken care of is if they're pushy. If you're someone who's uncomfortable being confrontational, then you're going to be left sitting in the airport. It needs to stop being subjective. It needs to stop being about who you know or how well you talk."

JetBlue is taking away some of that subjectivity by standardizing procedures. The new policies distinguish between arrival and departure delays, and will award compensation if an airplane lands and takes more than 30 minutes to reach the gate as a result of decisions by JetBlue.

For arrival delays, customers will receive vouchers applicable to the purchase of future flights for $25 for delays of up to one hour and $100 for one to two hours. They will receive the cost of one-way ticket identical to the one purchased for a two-to-four hour delay and the cost of a roundtrip ticket for delays of more than four hours.

JetBlue will pay a customer a $100 voucher for departure delays of three hours, will issue a voucher for a new trip after four hours and will remove people from the airplane after five hours.

JetBlue also will provide customers $1,000 in cash, rather than the $400 the federal government requires, if they are ever denied boarding.

However, there remains a lot to be desired from a compensation programs or vouchers—particularly for corporate travelers. David Hillman, a corporate travel consultant with Consulting Strategies, said it's difficult to quantify the true cost of inconveniences to travelers.

"The price of plane fare is not the big factor," Hillman said. "It's the cost of doing business, loss of time, the inability to get to a meeting. There's a whole list of things that you can't possibly put a price tag on that an insurance company wouldn't accept."

Sybase's Carlin agreed. "I don't want a voucher," she said. "I lost my trip, the business meeting happened without me. I'm not going to be going back there. I may never have an opportunity to get on JetBlue again, because the places I normally go aren't served by them. If they really wanted to do something useful, they would provide a monetary return that is not tied to future travel."