Qantas has agreed to pay $105 million, with no admission of liability, to settle a class action regarding flight credits during Covid, that was brought against the airline in August 2023.
The settlement is subject to approval by the Federal Court of Australia.
Leading the suit was Echo Law, which alleged that Qantas customers were entitled to full cash refunds rather than flight credits. The law firm said that these credits were worth significantly less to customers than the refunds they were owed.
The four main allegations towards the national carrier were: It breached its contract with customers by failing to provide cash refunds, it engaged in misleading conduct, it unlawfully benefited from customers by holding a significant amount of customer funds that ought to have been refunded and that it engaged in unconscionable conduct.
“In the coming weeks the Court will be asked to approve a notice to Group Members confirming the details of the proposed settlement and setting out what Group Members must do to claim their share,” Echo Law said in a statement.
It asked affected passengers to register their interest to receive updates on the settlement.
“It does not cost any money to register and you will never be ‘out of pocket’ as a result of participating in this class action,” it said.
The class action related to flights scheduled to depart between 1 January 2020 and 1 November 2022 that were cancelled by Qantas, and included allegations that the airline breached its contractual obligations regarding refunds.
In August 2023, Qantas removed the expiry date on flight credits issued during Covid*, meaning customers can request a cash refund indefinitely.
Qantas has previously made a provision for this matter and an increase reflecting the settlement will be recognised outside of underlying earnings in the second half of FY26. The settlement amount will be paid to a Court-approved settlement administrator, with payment currently expected in the first half of FY27.
*For Qantas customers, a ‘Covid Credit’ refers to travel credits for bookings up to and including 31 September 2021.
