Airline SAS Fined For Failing To Refund Passengers After Summer Pilots’ Strike

The Scandinavian Airlines (SAS) pilots’ strike may have ended in mid-July but the fallout for the company is far from over.

Thousands of passengers are still awaiting refunds and compensation payments legally owed to them by the airline for flights canceled in the first half of July, more than three months ago.

Norway’s Civil Aviation Authority (CAA) has lost patience and issued the airline with a fine.

A costly pilots’ strike

Approximately 4,000 flights were canceled across Scandinavia during the pilots’ strike in July, impacting more than 380,000 passengers.

One of the major points of contention was the length of the new collective agreement between the airline and the pilots’ unions. SAS wanted to lock down the deal for at least six years, despite the typical length of a collective agreement in Scandinavia being just two years.

Following intense mediation, pilots’ unions accepted an unprecedented five year term in order to end the strike. SAS also agreed that several hundred former pilots who were laid off during the pandemic would be offered their jobs back with seniority restored.

However, the trouble didn’t end there. SAS was then faced with massive liabilities in the form of passenger refunds and compensation payments. In the last SAS quarterly report presented in August, the airline stated the overall financial impact of the strike in lost revenue and costs was likely to be 1.5 billion Swedish kronor (US$145 million).

On top of millions of kroner in refunds for canceled flights, the airline must pay much more in EU compensation payments and refunds for the money passengers spent on alternate transport and accommodation in order to get home.

In mid-September, the CAA issued an order for SAS to issue outstanding refunds within seven days. As the airline have still not met this requirement, the CAA have now issued the airline with a fine of 100,000 Norwegian kroner ($9,500), with the threat of further fines if the situation is not resolved within ten days.

SAS argues over complex cases

Tonje Bjerve Sund, SAS Norway press manager, said that the airline disagrees with the CAA’s view on what SAS calls “complex cases.” The airline classifies these as those cases which include refunds for alternative travel arrangements and accommodation, for example.

“These must be processed individually and partly manually, and this takes time,” stated the airline. Sund said SAS aims to be finished with all refunds by the end of the year. For some travelers, that will mean a total wait of more than five months.

Important for “trust in aviation”

CAA director of aviation told NRK that following the fine, he now expects SAS to do what it takes in order to refund passengers.

“For us, it is important that consumers can trust aviation and that they actually get the money they are entitled to. We consider that it is important for aviation as an industry, and for the individuals concerned,” he said.

The Norwegian Consumer Council has received 750 complaints regarding SAS this year, much more than in previous years.