In what will probably come as a shock to no one, travel has been the most-complained about topic since COVID-19 hit, according to Australia’s consumer watchdog.
The impact of COVID-19 on consumers and fair trading report reveals the pandemic’s impact on travel resulted in 24,210 complaints to the Australian Competition & Consumer Commission (ACCC), an increase of 497 per cent compared to the same period last year.
That report noted that the large increase in travel-related complaints was “unsurprising” given the immense impact of domestic and international travel restrictions and the subsequent cancellation of bookings on both consumers and travel businesses.
“The situation with respect to travel cancellations has been complicated further by the majority of travel insurance products excluding cancellations resulting from the pandemic,” the report said.
Other industries with large increases in complaints to the ACCC so far this year include sport and recreation (up 134 per cent on the same period in 2019), fuel retailing (121 per cent) and insurance (104 per cent).
ACCC commissioner Sarah Court said the economic disruption from COVID-19 has led to a huge volume of varied and complex consumer law issues.
“Common misconduct we’ve received complaints about during the pandemic includes businesses misleading consumers about their right to a refund, or deducting cancellation fees from refunds when there is no contractual basis to do so,” she said.
When cancellations occur due to government restrictions, Australians are not automatically entitled to a refund as they would be in normal circumstances under the consumer guarantees of the Australian Consumer Law.
For the vast majority of services and events cancelled due to COVID-19 restrictions, it is the terms and conditions of each individual booking that determines whether consumers are entitled to a refund or credit note.
Court said the ACCC has had to step in and help consumers and businesses understand the legal ramifications of cancelled services.
In March this year, the ACCC adjusted its priorities to focus on competition and consumer issues arising from the pandemic and established a COVID-19 taskforce to address immediate harm to consumers and small business.
The taskforce has primarily focused on the travel industry, and its engagement with roughly 50 travel businesses to date has ensured that hundreds of thousands of consumers received the remedies they were entitled to under the terms and conditions of their contract.
“We decided early on that the best way we could help consumers was to educate businesses about their legal obligations and resolve issues quickly and efficiently, rather than taking court action,” Court said.
“We announced some cases such as Flight Centre, Qantas and Etihad, where we worked with those businesses to improve their treatment of customers, but we’ve been doing a lot of other work behind the scenes with dozens of travel businesses to get refunds and other remedies for customers who had their holiday plans dashed.
“The ACCC is very conscious of the fact that many businesses have struggled to process cancellations and respond to consumer queries as they have reduced staff capacity and are struggling to stay afloat. We have taken these issues into account in our engagement.”
Court said the pandemic is likely to have a long-term impact on many industries and the work of the ACCC’s taskforce will have to continue as issues persist.
“The ACCC will work with the federal government and the state and territory consumer law regulators to consider whether policy reforms are required to address some of the gaps and other industry-specific issues that COVID-19 has highlighted,” she said.
The Australian Federation of Travel Agents welcomed the report, with chairman Tom Manwaring saying that the organisation continues to work collaboratively with the ACCC and with the industry on ensuring consumers and businesses are informed of their rights.
“Securing the refunds in the current landscape is a complex, time-consuming process,” he said.
“What once took hours is now taking days, weeks and often months for the global airlines, hotels and tour operators to provide refunds and credits to travel agents to pass through to their customers.
“Each of these suppliers has their own processes, terms and conditions which further complicates the matter.
“Australia’s travel agents have spent almost all of this year working round the clock, often seven days a week, navigating this process for their customers and clients. They are doing this not only with almost zero income as a result of the international travel ban.”
[PLEASE NOTE: THIS ARTICLE HAS BEEN UPDATED SINCE PUBLISHING TO INCLUDE COMMENTARY BY THE AUSTRALIAN FEDERATION OF TRAVEL AGENTS.]
Featured image source: iStock/mrdoomits