Christopher Reynolds, Canadian Press
Published Sunday, December 17, 2023, 4:24 PM ET
Last updated on Sunday, December 17, 2023 4:24PM EST
Colleen Dafoe was at the Halifax airport with her husband and daughter last December when WestJet told them their trip was canceled.
Long after DeFoe’s planned vacation to the Dominican Republic to celebrate his 50th birthday with relatives had ended, the airline offered to reschedule the flight more than 10 days later. she said.
They never left Nova Scotia.
Defoe said she asked WestJet for a refund, but was refused and instead offered a one-year vacation voucher. Ultimately, she sued in small claims court for the $1,200 in damages her family believed they were owed under the Canadian Charter of Passenger Rights.
Only after she filed suit did WestJet’s lawyers offer to pay her in full if she signed a non-disclosure agreement prohibiting her from discussing the matter.
“My husband and I talked about this and thought about it. Some of us decided to stand our ground and accept the confidentiality clause because airlines shouldn’t silence people who don’t follow regulations. There was a part of me that didn’t want to do it,” Dafoe said.
Ultimately, DeFoe agreed to a settlement that included a confidentiality clause barring disclosure of the amount.
WestJet said it “does not publicly comment on NDAs, regardless of the topic or situation.”
Defoe said going to court “seemed kind of scary, so I agreed to settle the case.” He didn’t know if he could operate the system well enough to avoid losing out to his full-time lawyer.
Her case fits into a clear pattern in which Canada’s two major airlines first respond to passenger complaints by offering vouchers, often worth between $150 and $300. If the customer then refuses and pursues a claim in court, Air Canada and WestJet may end up paying the same amount as the original request after a lengthy back and forth, as long as the NDA is signed. You will be offered a higher amount than that.
The Canadian Press contacted more than 20 Canadian airline passengers who faced similar scenarios to Defoe. Some declined the offer, but others agreed to settlements of more than $1,000.
Consumer rights groups say non-disclosure agreements between large companies and individual customers are not routine in most fields, and that the policy is used to set legal precedents and avoid spreading rumors of payments. They warn that this is tantamount to a power play by the company.
Under Canada’s Air Passenger Protection Regulations, airlines must compensate travelers for a variety of violations, from canceling flights to failing to promptly rebook customers.
The system is overseen by Transport Canada, which faces a record backlog of 61,000 complaints against airlines as of Dec. 5. Many travelers say they choose to skip the regulatory process, which only begins after an initial complaint directly to the airline is denied. — because of wait times of nearly two years in some cases.
Air Canada said in a statement that the non-disclosure agreement was not unusual and that it would pay compensation if required.
“NDAs are very common in the context of litigation dispute resolution, and agreeing to an NDA is often part of a settlement agreement entered into before a court hearing,” spokesman Peter Fitzpatrick said in an email. I wrote it by email.
“These are designed to protect the integrity of the negotiation process, especially since each case is different and settlements are not directly comparable.”
But Sylvie de Bellefeuille, a lawyer with the Quebec-based advocacy group Option Consomamate, said the main goal is to limit the backlash online and in court.
“They don’t want to set a precedent. And especially now with social media, they may not want people to say, ‘We compromised with Air Canada for $500,'” she said. .
These concerns about reviews are consistent with the justification for the NDA that WestJet’s lawyers presented in an email to a customer last October. Despite very different travel circumstances, you may be compensated in the same or similar manner. ”
An Air Canada paralegal is suing Elizabeth Patrick, who is seeking $400 in compensation and costs after her January flight was delayed for more than five hours due to a defective part of the plane’s door. He gave a similar explanation of the call, which he recorded and shared with The Canadian Press. “You believe you are entitled to $400, but we say you are not entitled to it. That’s why it’s important to us that you sign a non-disclosure agreement.” ” the paralegal said over the phone.
Confidentiality clauses are so important to airlines that they go through a lengthy process that involves negotiations with corporate lawyers, sometimes offering the amount requested in passenger litigation, and sometimes even NDAs. They may also offer a higher amount.
Darren Guy said Air Canada initially gave him a $20 meal voucher and did not provide him with a hotel room after his overnight flight from Montreal to Vancouver was canceled in May due to crew issues. Ta. So he asked for accommodation and $1,000 in damages.
Air Canada paid him $758 for the hotel, but declined to provide compensation, which stipulates up to $1,000 for disruptions of nine hours or more within the airline’s control.
Guy filed a lawsuit in small claims court, and Air Canada responded by offering “gift certificates and cash.” he refused it. The offer was up to $1,000 in vouchers and $800 in cash, which exceeded his $1,000 asking price.
“The only condition was to sign a gag order,” Guy said, calling the experience “frustrating” and “ridiculous…cliché.”
“It just makes me angry. I’m stubborn and no one tells me what I can and can’t talk about,” he said.
He rejected the airline’s higher offer.
Kelly Geraghty, of Maple Ridge, B.C., who sued WestJet for $11,000 in damages, including emotional damages, after last year’s flight suspension, said the confidentiality clause was suffocating. He said he was imposing silence.
“The big thing for me is that it’s a lifelong burden. I’m not even allowed to talk to my spouse about it,” she said of the contract signed inside the NDA black box.
“If they haven’t done anything wrong, why would they try to hide it?”
In some cases, the settlement offer may be significantly lower than the amount requested. John Lawford, executive director of the Public Interest Advocacy Center, said many customers may not know that they can simply reject a “lower offer” to receive a higher offer from an airline.
“This is kind of a massive power play by a much more powerful political party,” Lawford said, calling the practice “unconscionable, unscrupulous, cheap…these are very small amounts.” Ta.
“The aim is to silence dissent and reduce criticism of the company,” he said. “You’re silencing someone about a situation that could be indicative of other problems with the airline.”
But from a business perspective, airlines are simply doing what makes sense under the current rules and enforcement system, said Gabor Lukacs, an air passenger advocate.
“From an economic perspective, the airlines are doing the right thing,” he said, stressing that the “smoke screen” created by confidentiality clauses was preventing a surge in incidents.
“Airlines are not evil, neither good nor bad. They are simply playing the nearest optimal strategy in a game of stacking the cards against passengers.”
To expedite the complaint process and direct customers to regulators rather than the courts, Transport Canada created the role of a “grievance resolution officer.” Training began in mid-August, and 50 people have now been hired, with another 50 expected to join next year, the agency said.
Regulations are currently being tightened to enforce fundamental reforms to the country’s Passenger Charter of Rights. Changes to the Air Passenger Protection Regulations announced in April and expected to come into force in the first half of 2024 will eliminate loopholes that have allowed airlines to refuse to compensate customers if flights need to be delayed or canceled for safety reasons. It appears that it will be abolished.
The new regime, first introduced in 2019, increases maximum fines for airline violations tenfold to $250,000 and imposes regulatory costs on airlines for complaints.
