Downgraded from business class to economy on KLM. But they messed with the wrong passengers!

KLM picked the wrong passengers to downgrade from business class to economy on a recent flight from Miami to Amsterdam.

The couple, Fran and John Edwardson, were on a trip of a lifetime to see the great migrations on the Serengeti. 

“It was a combined birthday and Christmas gift from my husband,” says Fran Edwardson.

John Edwardson wanted it to be extra special, so he paid $21,322 for two business-class tickets for his wife and himself. But the day before their flight, KLM downgraded the couple to economy class. Then, it kept most of their money and told them to contact their travel agent if they wanted to appeal.

This isn’t another sob story about two wealthy retirees on safari who turned to our advocacy team for help. There’s a shocking twist at the end. You might have already figured it out if you’re an airline insider.

The Edwardson case raises several questions:

• Are airlines allowed to downgrade you?
• What does an airline owe you for downgrading you from business class?
• What are some insider tricks for negotiating more compensation for a downgrade?

But to get to the answer — and the unexpected outcome — let me first tell you what happened to these passengers.

“We feel we were bait-and-switched”

Getting to Tanzania involved multiple flights, first from Miami to Amsterdam and then a connection from Amsterdam to Kilimanjaro International Airport in Tanzania. The return flight had two stops. 

The Edwardsons had checked in the night before and received their boarding passes, but on the day of their flight, they received an email from KLM that it had changed their aircraft. Now they were sitting in seats 35 A and B — in regular economy class.

“Business class on the outbound flights was the most important aspect of our itinerary, so we could have lie-flat beds, get some sleep, and begin our vacation refreshed,” Fran Edwardson says. (Related: Why won’t KLM refund my flex ticket?)

It’s an almost 12-hour flight from Miami to Amsterdam, and in economy class, it’s just torture.

They tried to fix the problem at the airport, but KLM stood firm. New plane, new seats.

When the couple returned to the U.S., she complained about the downgrade. In response, KLM offered the couple two nonrefundable travel vouchers worth $924. She protested, citing EU consumer protection laws, but again, KLM wouldn’t move. If she wanted cash compensation, a representative told her, she should take it up with the travel agent who had booked the tickets for her.

“We feel we were bait-and-switched,” she says.

All the while, KLM apparently had no idea who they were doing this to.

Are airlines allowed to downgrade you from business class to economy?

Airlines are allowed to downgrade to a lower class of service. There are no regulations or laws that prohibit an airline from moving you from one class to another.

You’d be surprised by how often it happens. An airline might have an equipment change from a larger aircraft to a smaller one which would have fewer business class seats.

How does an airline decide who stays in business class and who goes?

I’ve spoken with airline insiders about this, and they say they have a fairly sophisticated formula that takes into account your frequent flier status, the amount you paid for your tickets, and your value as a customer. A ticket agent may also override the system, but most of these equipment changes are highly automated.

Not only was KLM allowed to downgrade the couple, but it had also made a calculation that they either hadn’t paid enough for their tickets or just weren’t valuable to the airline. But it had made a serious miscalculation.

What does an airline owe you for downgrading you from business class to economy?

If you get downgraded to a smaller seat, what does the airline owe you? Well, as it turns out, there are specific policies that apply.

• In the United States, the Department of Transportation requires that your airline refund you the difference in the ticket price if you’re downgraded from a higher class of service to a lower class.

• In the EU, a rule called EC 261 requires a refund a percentage of your ticket price. It ranges from 30 percent to 75 percent, depending on the distance.

• UK consumer protection law mirrors EC 261 when it comes to downgrades.

An argument could be made that EU regulations were in force because KLM was a European carrier flying to Europe. DOT’s consumer protection rules might also apply because the Edwardsons’ flight originated in the United States. But there’s a problem with the U.S. rule because there’s some flexibility in how an airline gets to define terms like “ticket price” and “refund.”

KLM could base a refund on the ticket price at the time of their flight, which would be the most expensive economy-class walk-up fare. That’s called airline math, and it would eat away most of their expected refund.  

Also, how to define “refund”? Would that be a cash refund or an expiring credit?

Not surprisingly, it seems KLM decided to follow regulations in a way that was most advantageous to the airline. It might not have done so if it knew who it was dealing with. (Related: Did KLM lie about her ticket refund?)

Insider tricks for negotiating more compensation for a downgrade from business class to economy?

Downgrades happen. When they do, you need to be prepared to negotiate your way back to your purchased class of service or get a refund.

Know the terms of your ticket

Before you ask for a refund or compensation, remember to research the original fare rules associated with your ticket. Some tickets come with specific benefits, such as lounge access or priority boarding, that could potentially increase the value of your compensation request. Others are completely refundable, so you can always ask for all of your money back. (Related: Should I have been charged extra for my checked luggage?)

There’s no time like the present

The best solution is to get the airline to reverse course, sending you back to your original seat. You can do that by speaking with a ticket agent before the flight. Remember to maintain your composure. Politely express your disappointment and ask for a resolution before the flight leaves. One popular solution: The airline may be able to reschedule you on the next flight on which there’s room and cover your lodging expenses. (Related: Is this enough compensation? A partial refund for my dogless flight.)

Never take the first offer

It’s often a negotiation. An airline may try to make you go away by offering you a flight voucher. It can do better. If an airline offers you funny money, remember that most governments require at least a partial refund of the price of your ticket in cash. If you’re thinking of accepting the voucher, make sure it’s well over the required amount.

Escalate your case if necessary

If the airline doesn’t do the right thing, respectfully escalate the issue to a supervisor or customer service manager. Higher-level employees generally have more flexibility when they’re addressing complaints and resolving disputes. You can find a manager on our company contacts page. 

Most importantly, you don’t want to sit on an involuntary downgrade case for too long. Airlines are not that great at recordkeeping, and if you delay your complaint, it’s possible the airline will forget what happened. How convenient.

A complicated case — and an unexpected conclusion

This was a complex case that involved a multi-leg flight, a third party booking the tickets and an international airline. Fortunately, this one got assigned to our advocate, Dwayne Coward, who has a particular set of skills when it comes to airline problems.

KLM’s initial offer was completely inadequate. It wasn’t following U.S. or EU rules. And it appeared to be leaning on the travel advisor for a resolution, even though that person had nothing to do with the downgrade and had simply booked the ticket.

The Edwardsons were considering a credit card dispute, but we cautioned against that. Chargebacks are a last resort, as I mention in my guide to credit card disputes. The Edwardsons still had options.

There was also the question of how much, exactly, these passengers should get. Which formula should we use to calculate the fare difference? Should KLM base it on a walk-up fare or the fare differential at the time of purchase?

Dwayne reached out to the travel advisor to see if he could help. The agent was not familiar with how to request a refund through her reservation system, so he helped her file a request. 

A few days later, we got some good news.

“I wanted you to know that we’re receiving a refund of $4,051 from KLM,” Fran Edwardson wrote. “While it’s less than what we’d hoped for, it’s in line with the EU regs requiring a 75 percent refund if we look at this segment as one-quarter of our itinerary. We are extraordinarily grateful for your help. You perform an important consumer service.”

And now, the twist 

But there was more.

“Now, true confessions,” added Edwardson. “Once upon a time, my airline industry job was as senior vice president and general counsel, and my husband was president. Both at United Airlines.”

That’s right, my friends. KLM did this to the former president of United Airlines.

I know some of you are probably thinking that this is payback. Edwardson, like other airline CEOs, put policies in place that put profits over people. And people are constantly leaving comments on this site that say, “I wish airline CEOs would sit in their own economy class seats.”

But honestly, no one deserves this. The Edwardsons should have gotten the seats they paid for, no matter who they were. 

But really, KLM. Could you at least Google your passengers?

Need to contact a KLM executive?

KLM’s initial offer was completely inadequate and ignored clear E.U. regulations. When an airline’s front line won’t help, it’s time to escalate your complaint. Get the executive contacts →