(Reuters) – Australian airline Qantas Airways said on Monday it had agreed to pay a fine of A$100 million ($66 million) to settle a lawsuit accusing it of illegally selling thousands of tickets on flights that had already been cancelled.
The punishment is subject to approval by the Federal Court of Australia, the statement said.
As part of its agreement with the Australian Competition and Consumer Commission (ACCC), Qantas will launch an additional A$20 million redress program for passengers affected by flight cancellations, with each affected customer receiving payments ranging from A$225 to A$450 dollars, the airline said.
“We are pleased to have Qantas admit that it misled its customers and agree that this conduct warrants very significant penalties,” ACCC chair Gina Cass-Gottlieb said in a statement. “The size of the proposed fine is an important milestone in ensuring compliance with the Australian Consumer Law.”
The ACCC filed a claim against Qantas in August last year, alleging that in some cases the airline’s tickets were sold for weeks after cancellations.
“As flights resumed following the Covid-19 shutdown, we recognize that Qantas has failed customers and failed to meet our own standards,” Qantas CEO Vanessa Hudson said in a statement.
“We know that many of our customers have been harmed by our failure to provide cancellation notices in a timely manner, and we are truly sorry.”
Hudson said the airline has modernized processes and is investing in new technology to avoid a repeat of the situation.
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Qantas said the financial impact of the remediation program and fines will be included as an expense in the group’s financial results for the financial year ending June 30, as an item outside the airline’s key profit measure underlying pre-tax profit.
The actual cash outflow for damages and fines is expected to occur in the next financial year, the airline added.
($1 = 1.5138 Australian dollars)