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Tuesday, April 13, 2021

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Pilot strike verdict: airline has to pay compensation to customers

If a flight is canceled or significantly delayed due to an announced strike by airline employees, the customer may be entitled to compensation. The airline could not argue that such a strike was an “exceptional circumstance”, the European Court of Justice (ECJ) justified its ruling. If the labor dispute is limited to enforcing, for example, salary increases or better working hours, this is “part of the normal exercise of the company’s activities”.

An exceptional circumstance within the meaning of the Air Passenger Rights Ordinance exists if the nature or cause of the occurrences is not part of the normal exercise of the activity of the airline concerned and cannot actually be controlled.

Airlines face high costs

The present case concerned the action brought by the service provider Airhelp against the airline SAS. A Swedish passenger demands compensation of 250 euros because a flight from Malmö to Stockholm scheduled for April 2019 was canceled on the same day due to a pilots strike in Norway, Sweden and Denmark. The pilots wanted to push through a pay rise with the strike. According to the airline, more than 4,000 flights were canceled because of the multi-day stoppage, which affected almost 400,000 guests. According to the airline, if every guest had received a flat-rate compensation payment, costs of almost 120 million euros would have arisen.

The company refused to pay compensation, referring to the exceptional circumstance. The competent Swedish court asked the ECJ to interpret the Air Passenger Rights Ordinance. In its Opinion, the responsible ECJ Advocate General took the view that a strike organized by trade unions was an exceptional circumstance. The judges do not have to follow the advocate general in their judgment.

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