Rex cites industry pressure to tighten refunds

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January 12, 2021
Rex pressure
Photo: Rex.

Australia’s Regional Express (Rex) claims it has been criticized by rivals because of its more liberal COVID refund policy but has declined to reveal details.

Rex general manager of network strategy Warrick Lodge said in a statement that the regional carrier’s refund policy had been criticized by other carriers and vowed that it would not give in to “industry pressure”.

But when asked for further details or the criticism and its source, an airline spokesman said the company could not reveal details of confidential discussions.

READ: Virgin lounge network expands with Perth and Gold Coast.

The claim came as the airline reiterated its promise of full refunds for customers whose travel has been stymied by COVID-19, including “use-it-or-lose-it” promotional fares.

As Australia suffers another wave of border closures and restrictions, the airline says it will provide refunds for people who cannot fly because of border or travel restrictions even if they are on a service that is still operating as scheduled.

The airline’s refund policy is more liberal than those at rivals Qantas and Virgin Australia and Lodge said the airline remained committed to a full refund of tickets affected by any flight cancelation or rescheduling “without exception”.

“Rex will be offering a full refund of tickets for passengers who are directly affected by current and future COVID-related border closures or traveling restrictions, even though our flights continue to operate as scheduled,’’ he said. “This even applies to promotional ‘use-it-or-lose-it’ tickets.”.

Lodge said the airline in 2020 proactively refunded tens of thousands of valid tickets booked directly with the airline “even without a refund request”.

He said it also sent eight monthly reminders to travel agents to seek refunds from Rex on behalf of their clients.

“The Rex COVID refund policy goes far beyond the guarantees provided under Australian Consumer Law and seeks to alleviate the considerable hardships our passengers are already facing during the pandemic,’’ he said. “It also removes the risk they take in making bookings for future travel during this period of uncertainty.”

Muddying the water, however, is Victoria’s new “traffic light’ policy of color-coded graduated restrictions.

The Victorian system bans people who have visited a red zone in the past 14 days from entering the state without an exemption.

Those from an orange zone, which includes regional NSW,  can apply for a permit but are required to take a COVID test within 72 hours and self-isolate until they get a negative result.

People from a green zone must also apply for a permit but do not need to be tested or isolate.

Asked what would happen if customers from the orange zone decided to cancel travel to Victoria because of fears they could hit limitations or problems, the Rex spokesman said it would make a case-by-case assessment where travel was still permitted to a passenger.

Refunds have been a touchy subject with airlines generally as they faced crippling losses and moved to limit cash burn during the pandemic by trying to steer customers into accepting credits for future travel.

Customers who booked flights with Virgin Australia before it went into administration are still forced to accept flight credits although refunds are available for those who booked after the carrier’s return to service and whose flights are canceled.

Rex has not escaped scrutiny on this issue and in September last year, the West Australian consumer commissioner announced the airline had agreed to review its policies and procedures to ensure compliance with Australian Consumer Law.

The airline agreed to modify some terms and conditions on its website regulators believed had the potential to mislead consumers by giving the impression a refund was not available under any, or very limited, circumstances.

“The circumstances in question were before the COVID-19 coronavirus pandemic, and we acknowledge that Rex has taken proactive steps during the pandemic to assist customers and offer appropriate remedies,’’ WA Consumer Protection Commissioner Lanie Chopping said at the time.