Travel companies can wait until three days before departure before cancelling bookings for holidays which can’t go ahead due to Covid restrictions, say travel industry lawyers.
Travlaw senior associate Nick Parkinson said: “The customer is entitled to a full refund if at the point of cancellation there is no hope the holiday can carry on.
“[But] there is no fixed date on this. You can make it quite late on. Three days before departure is reasonable because there are changes every day. A week before departure, the position might change. A destination might go green. Three weeks before departure it’s not reasonable to cancel.”
Speaking on a Travlaw advice webinar, Parkinson said the relaxation of quarantine restrictions to amber countries for fully vaccinated travellers from July 19 means “not a lot of changes from a legal perspective”.
He pointed out: “The Foreign Office [FCDO] advice is always what you look at.”
Parkinson noted: “There is still a good proportion of people who have not been double jabbed who will be caught by the requirement to quarantine.” However, he insisted: “We don’t think that triggers a refund.”
Matt Gatenby, Travlaw senior partner, agreed. He argued: “The traffic light system is about what people have to do when coming back. It’s not about going [on holiday]. It doesn’t affect the services you provide. What makes a difference is the FCDO advice.”
Asked whether a customer is due a refund if they don’t wish to travel because of restrictions in a destination, Gatenby said: “It’s a question of fact and degree.
“If it means significant changes, the customer has the option to cancel [with a refund]. But are we talking about waiters wearing face masks or restaurants being closed and the beach cordoned off?”
He added: “How you sold the package is important. What have you promised?”
Krystene Bousfield, Travlaw senior associate, pointed out: “What is significant to one person might not be significant to another. We had a case where a resort hairdresser was closed. That could be significant if a booking was for a wedding.”
Parkinson said a customer wishing to cancel because of the cost of Covid tests would not be entitled to a refund because “it doesn’t significantly affect their ability to go – the tests are available”.
But if a destination only allows entry to those fully vaccinated, a non-vaccinated customer could be entitled to a refund.
Parkinson said: “If a passenger couldn’t get a vaccination, if there is nothing reasonable they could have done, they have a good shout for a refund.”
However, those who have not taken “all reasonable measures” or don’t wish to be vaccinated would not.
When customers cancel and are not entitled to full refunds, it’s important firms justify their cancellation charges, say the Travlaw lawyers.
Parkinson said: “You can’t just pull a number out of the air. Most people have a sliding scale of charges. The closer the cancellation is to departure, the higher these are. Just make sure your charges reflect what someone would think is fair. You need to be able to say to a judge ‘This is the reason I charged that.’”
Gatenby agreed: “It has to be a genuine estimate of loss. But you can’t spend hours on every cancellation. It comes down to a fair estimate.”
He added: “Judges are happy to accept a profit margin [on a cancelled holiday]. You are a business – you should take account of some margin.”
A lockdown in a destination which means a holiday has to be cancelled mid-way through would require “an appropriate price reduction and repatriation”, said Bousfield. But she argued: “There would be no additional compensation because the circumstances are unavoidable.
“What is appropriate can be a simple percentage calculation or the cost of services used or based on what the customer missed.”
If a client is required to stay in a destination beyond the end of a holiday because they test positive pre-departure back to the UK, Parkinson said: “The most you would be liable for in most cases is three nights’ accommodation.”
He added: “If there was evidence of a customer breaking all social distancing rules, you might argue they were responsible for failing the test.”
Companies are free to insist only fully vaccinated passengers travel if they wish.
Gatenby noted: “The government is telling transport companies ‘You can make your own rules.’
But he noted: “There are a few things to consider. You need to ensure you comply with the Equality Act, that you’re not discriminating against anyone on the grounds of age, disability or belief, and be ready if a passenger says they have a medical reason for not being vaccinated.
“Also be aware of data protection. It’s medical information so it’s sensitive.”
Travlaw provides further advice on cancellations and refunds on its blog.