Regular readers will know that we have given much coverage in recent months to British Airways and its approach to EU261 compensation. This has primarily been around a perception that the airline is deliberately targeting Avios redemptions, and specifically British Airways American Express 2-4-1 redemptions, for downgrades because they are due less – or indeed no – compensation.
It seems that the airline has a few more tricks up its sleeve, however.
When you are downgraded, it is standard British Airways policy to give you a £200 gift card on the spot. Historically this has been ex-gratia compensation and is, basically, shutting you up. All of the other compensation you are due – EU261 (75% of the one-way ticket price) and the difference in cost between the ticket you bought and the ticket you flew – does not arrive until much later. This no longer seems to be the case.
Here is a copy of the gift card covering letter. This one is for £400 because it covered two people (click to enlarge):
The text at the top says:
You agree to accept this Card as the method of payment of your compensation under …. EU261.
Now …. it is true that, under Article 7.3 of EU261, British Airways can – with your written agreement – pay you compensation in vouchers, gift cards, Avios or whatever it likes. However, this is ONLY with your written agreement which you do not have to give. You are entitled to demand cash.
However, we then move on. This is what the EU regulations state:
Exclusion of waiver
1. Obligations vis-à-vis passengers pursuant to this Regulation may not be limited or waived, notably by a derogation or restrictive clause in the contract of carriage.
2. If, nevertheless, such a derogation or restrictive clause is applied in respect of a passenger, or if the passenger is not correctly informed of his rights and for that reason has accepted compensation which is inferior to that provided for in this Regulation, the passenger shall still be entitled to take the necessary proceedings before the competent courts or bodies in order to obtain additional compensation.
British Airways is simply not allowed to ‘call it quits’ under EU261 by giving you a £200 gift card as your full settlement.
The wording on the voucher – “You agree to accept this Card as the method of payment of your compensation under …. EU261″ – is quite clever, I think. It does not – legally speaking – mean that you are giving up your rights to EU261 compensation but, because of how it is worded, I think 99% of the population would assume that is what it meant.
Article 15 of the Regulation clearly stipulates that airlines cannot contractually limit or waive their obligations under the Passenger Rights Regulation. There is some leeway for compensation payments to be made through vouchers etc – but the amount due to the passenger cannot be varied, and there needs to be assigned agreement to pay in travel vouchers and/or other services.
My personal view is that you should never sign anything you are given by an airline. I certainly don’t think that you should sign this waiver, given that the gift card only has a three month life. I would also insist that the £200 be given as ex-gratia credit and not as part of an EU261 settlement, which is what it has historically been in the past.
How to earn Avios from UK credit cards (June 2021)
As a reminder, there are various ways of earning Avios from UK credit cards. Many cards also have generous sign-up bonuses!
There are two official British Airways American Express cards:
You can also get generous sign-up bonuses by applying for American Express cards which earn Membership Rewards points, such as:
We also recommend Capital On Tap for limited companies. You earn 1 Avios per £1 which is impressive for a Visa card:
Click here to read our detailed summary of all UK credit cards which earn Avios. This includes both personal and small business cards.
(Want to earn more Avios? Click here to visit our home page for our latest articles on earning and spending your Avios points and click here to see how to earn more Avios this month from offers and promotions.)