A British couple who were downgraded from premium economy to standard economy on a British Airways flight from Costa Rica to London earlier this year faced challenges in securing adequate compensation, highlighting ongoing concerns over the treatment of passengers who pay with loyalty points rather than cash.

The couple had booked their January return trip more than a year in advance using 60,000 Avios points, £750 in cash, and a two-for-one companion voucher, which allows one passenger to fly free with the purchase of a qualifying ticket. When they attempted to check in online 24 hours before the flight, they encountered an error. Arriving early at the airport, they were informed by staff that the flight had been overbooked in premium economy, resulting in their being downgraded to standard economy. Their assigned seats were reportedly among the least desirable on the plane.

British Airways offered to refund their Avios points and return the air passenger taxes, but the couple felt this inadequate, particularly as they believed the downgrade was related to their use of points rather than cash, alleging potential discrimination against loyalty programme customers. When their formal complaint to the airline did not resolve the matter satisfactorily, they sought assistance from an independent dispute resolution service.

The case was referred to the Centre for Effective Dispute Resolution (CEDR), which handles airline complaints in the UK. However, progress was slow, with BA reportedly reluctant to provide detailed information about how it calculated the compensation amount. British Airways offered £145 plus 27,750 Avios points, asserting that the companion voucher had no monetary value.

Travel industry expert Rob Burgess, editor of a rewards-focused website, noted that while downgrades for customers using loyalty points were a more common issue several years ago, current downgrade decisions are more likely made by automated systems rather than manual selection. Nevertheless, under European regulation EC261, passengers downgraded on flights of this distance should receive compensation equivalent to 75% of their ticket price.

CEDR determined that British Airways’ valuation of the points and voucher was incorrect. Lacking full information from the airline, CEDR used its own calculations based on the typical selling price of Avios points, about 1.7 pence each. It concluded the couple was entitled to compensation equating to £994.38 in addition to the £213 they had already received, covering 55,000 of the 60,000 points.

After approximately eight months, the couple confirmed receipt of the full compensation amount. Their experience illustrates the complexities and delays involved in resolving disputes related to loyalty point bookings, but also demonstrates that fair redress is achievable even in cases where airlines initially offer limited compensation.