The Trump administration has rolled back a Biden-era proposal that would have required U.S. airlines to provide cash compensation to passengers for flight delays and cancellations, marking a significant shift in airline consumer rights and industry operations. This move ends a policy intended to bring U.S. passenger protections closer in line with those seen in Europe and other countries, where airlines are often mandated to pay travelers for certain disruptions.
The rule, which was never enacted, was proposed by the Biden administration’s Department of Transportation in December 2024. It sought to require airlines to compensate passengers $200 to $300 for domestic flight delays of at least three hours caused by the airline, with escalating amounts for longer delays, up to $775 for delays exceeding nine hours. Compensation would also have covered cancellations and included provisions for lodging, meals, and rebooking on rival airlines if passengers were stranded overnight. The Biden administration framed the rule as a major advancement for travelers frustrated by frequent disruptions and lack of reliable compensation.
However, the Trump administration announced yesterday, that it would withdraw the proposal, stating the action was “consistent with department and administration priorities.” According to the Transportation Department, while it remains committed to enforcing consumer protections mandated by Congress, such as refunds for canceled flights when passengers choose not to travel, it views the Biden-era regulation as going beyond what federal statutes require. The department indicated plans to revise other related rules, including those governing the definition of cancellations and rules on upfront disclosure of ancillary fees, which impact transparency on ticket pricing.
Airlines and their industry group, Airlines for America, expressed strong support for the reversal. They argued that the proposed compensation plan would have imposed excessive burdens, increasing costs that would ultimately be passed on to consumers through higher ticket prices. The trade group called the plan “unnecessary and burdensome” and praised the Biden rule’s elimination as an effort to reduce regulations that exceed legal authority and fail to address key customer concerns. Spirit Airlines, which recently filed for bankruptcy and announced service cuts, had voiced opposition earlier in the year, warning that mandatory compensation and accommodation payments could incentivize airlines to cancel flights prematurely to avoid potential higher costs.
Consumer advocates and former Biden administration officials criticized the rollback. They argued that paying passengers for delays would not only put money directly back in the hands of travelers but also encourage airlines to reduce cancellations and delays by holding carriers accountable for disruptions within their control. The Biden proposal differed from current U.S. practice, where airlines are required to refund ticket prices for canceled flights if passengers opt not to travel, but are not obligated to compensate for delays. Unlike jurisdictions such as Canada, the European Union, and the United Kingdom, U.S. airlines typically offer vouchers for meals or hotel stays during prolonged delays but are not consistently required to provide cash compensation.
This policy change reflects a broader regulatory approach by the Trump administration toward the airline industry, emphasizing deregulation and minimal federal oversight. It follows earlier actions like dropping a Biden administration lawsuit against Southwest Airlines related to chronic flight delays, and it signals a preference for allowing airlines more operational flexibility without imposing stringent financial penalties for service disruptions. The shift may affect how passengers experience air travel in the U.S., possibly leaving fewer enforceable consumer protections for delay-related inconveniences.
For travelers, this means that while refund rights for canceled flights will remain intact, compensation for delays will continue to be handled on a voluntary, case-by-case basis by airlines rather than through binding federal rules. Passengers affected by disruptions may still receive meals, lodging, and rebooking options depending on airline policies, but the clear, direct cash payments envisioned by the Biden-era proposal will no longer be guaranteed. The ruling illustrates the ongoing tension between consumer protections and airline operational and financial concerns in U.S. aviation policy.
