Sometimes Getting ‘Bumped’ Has Its Rewards : Airlines: Consumers with confirmed reservations are being squeezed off flights due to overbooking. The good news is that there are now laws requiring compensation.

You’re booked for a flight. You even have your seat assignment. But when you get to the airport, you’re confronted with a long line of nervous passengers and a gate agent who announces that your flight has been oversold.

You plead. You protest. After all, you have a confirmed reservation.

It’s no use. The airline doesn’t have a seat for you. You’ve been “bumped.”

What rights, if any, do you have? Actually, quite a few.

But first, it might be helpful to define what bumping isn’t .

If your plane is canceled--for any reason--you’re not officially bumped. The flight is just canceled. You have no rights.

If you are on most international flights and the plane is overbooked and you’re denied a seat, you’re also out of luck. Again, you have no rights. (There are some exceptions, however, on European flights. More on that later.)

But if you’re holding a confirmed reservation on a domestic flight, and you arrive at the boarding gate at least 15 minutes before the scheduled departure time and are told the flight is overbooked, you’ve been bumped. And now you’re entitled to what is known as “denied boarding compensation,” usually in the form of vouchers good for free airline tickets.

It all started with an Allegheny Airlines agent named John McDonald. In 1972, McDonald bumped a passenger--a consumer activist named Ralph Nader--from a flight between Washington and Hartford, Conn. Nader sued.

Eight years later, the U.S. Supreme Court ruled in Nader’s favor. As a result of Nader vs. Allegheny, it wasn’t long before the U.S. Department of Transportation forced airlines to compensate people who are bumped from flights.

Officially, it’s called Rule 250. And this is what it says: If an airline overbooks a flight, it must first solicit volunteers interested in relinquishing their seats in return for a specified cash payment and a seat on the next available flight to the passenger’s original destination. If someone volunteers, that person shall receive compensation at the rate of 200% of the cost of his or her ticket, an award not to exceed $400. And the airline will then put the passenger on the next available flight to his/her destination.

If an insufficient number of passengers volunteer, then it gets interesting. The airline will up the ante of the potential award, and keep raising it, until enough volunteers can be found. Some awards as high as $2,000 have been given out on oversold flights to passengers who finally “volunteered” when the price was right.

But no airline likes to part with cash, especially these days. Several years ago, confronted with much higher denied boarding statistics, the airlines appealed to government authorities to allow them to compensate passengers with payment “in kind.”

Enter the “denied boarding voucher.” Most airlines now give these to bumped passengers in lieu of cash payments.

The voucher is good for free travel on a future flight on that airline, but be warned: These vouchers are often heavily restricted.

“With some vouchers,” says Sue Flatow, consumer affairs analyst for the DOT, “you can’t make a reservation more than a week in advance, and they are made on a fare that’s capacity-restricted, so there’s a good chance those seats aren’t available.

“Sometimes you are left holding vouchers that are impossible to use. If people knew these vouchers were this restricted, they’d think twice about volunteering their seats.”

Despite Rule 250, overbooking continues. Officials from U.S. airlines have privately acknowledged that on popular routes and high-demand flights, bookings average between 10% and 20% above capacity. During holiday periods, the figure can run as high as 40%.

No one is happy about overbooking. The airlines blame passengers for not canceling flights when they decide not to fly. Passengers blame airlines for overbooking and then refusing to honor their tickets, which, they contend, should be treated as a contract.

They’re both right.

Sometimes the number of no-show passengers can equal the number of overbooked passengers. When that happens, the plane leaves full. But it doesn’t happen very often. Some “overbooked” planes either leave the gates only half full due to no-shows--angering the airlines--or the planes really are overbooked and leave behind a horde of angry passengers who can’t get on.

For years the major airlines denied that they accepted more reservations for flights than there were seats on the planes. Now they freely admit that overbooking is a standard industry practice.

“Yes, we do overbook and it is a standard practice,” says Vince Durocher, Los Angeles-based district director of marketing for Delta Airlines. “We have to overbook in order to fill seats. The simple reason is that so many people are no-shows--from 10% to 25% on some flights.”

This year, however, fewer people are being bumped. One possible, and logical, reason: Fewer people are flying. But that’s not the case in Europe and Asia, where overbooking is not just a standard airline practice but a rampant one.

Until recently, passengers on international flights have had no recourse when they’ve been bumped. But now there’s some good news. The Association of European Airlines has introduced specific guidelines designed to protect passengers.

For the first time, air travelers with seat reservations who are denied boarding on flights leaving airports in European Community countries--Ireland, England, the Netherlands, Greece, Portugal, France, Denmark, Spain, Luxembourg, Belgium, Italy and Germany--are guaranteed compensation.

Now if you’re bumped and not given another flight within two hours, you’re entitled to hotel accommodations, telephone calls and meals, as applicable.

Airlines are also required to pay bumped passengers $140 for flights under 2,174 miles one way, and up to $280 on flights of more than 2,174 miles--if they don’t put the passengers on another flight within two hours.

“I welcome the compensation,” says Giovanni Bisignani, chief executive officer of Alitalia. “Paying passengers who are bumped is one of the few things about American deregulation that was a good idea. For airlines to survive, they must concentrate on service. If my airplane can’t fly a passenger who holds a reservation, we haven’t served him too well, have we? So it’s a good idea.

“Now,” he says with a sigh, “if we can only solve the problem of no-shows.”

Not surprisingly, airlines such as Alitalia are concentrating their efforts to limit the no-show factor in the high-revenue first-class and business-class cabins. Passengers holding reservations are often telephoned by the airline and asked to reconfirm.

The no-show problem--that is, people who make reservations for flights and then simply don’t show up--continues to plague airlines.

But there has been some progress. Recognizing how costly overbooking had become a few years ago, major airlines such as American, United and Delta began developing a sophisticated set of computer profiles and tracked traffic patterns and passenger volumes so that they could more accurately estimate the number of no-shows on each flight. That way they could overbook flights with confidence that few passengers would actually be bumped.

The results have been impressive. Last year, the Department of Transportation reported that there was a “dramatic decline” in the number of passengers bumped by airlines. There were only 1.55 “bumps” per 10,000 passengers in 1990, compared to 2.59 in 1989. That’s 68,560 passengers bumped in 1990 versus 106,765 in 1989.

Breaking the numbers down even further: Of more than 73 million passengers carried by American in 1990, only 1,332 were denied boarding. (More than 104,000 passengers willingly volunteered to get bumped.) That works out to 0.18 bumps per 10,000 passengers, the lowest figure in the airline industry. United was next with 0.37 passengers bumped per 10,000, then Delta at 0.52. America West was the worst, with 6.15 bumps per 10,000 passengers.

Of course, there are some folks who look at getting bumped as nothing less than a great opportunity. Some passengers will actually do their own projections as to which flights stand the best chance of being overbooked, and will go to the airport hoping not to get a seat--but to get travel vouchers instead.

Heavily traveled routes and times--such as 8 a.m. Detroit-to-New York, or 5 p.m. New York-to-Chicago flights--are notorious targets.

Others discover--accidentally--the benefits of bumping. The record for most number of free trips may be held by a Brighton, Mich., family. Two years ago, Mark Hawley, his wife and three children attempted to fly from Denver’s Stapleton Airport. When their United flight to Detroit was overbooked, the airline asked for volunteers. The family got five free tickets for getting off the plane.

When the family attempted to fly again a few months later, the same thing happened. The family volunteered, and got five more free tickets. When they tried to take a later flight the same day, it, too, was overbooked. They volunteered for a third time. Another five vouchers. When they finally got on a United plane that wasn’t overbooked, it was a flight that went to Detroit via Chicago.

When they landed in Chicago, you guessed it: Their Chicago-Detroit connecting flight was overbooked. Another five tickets.

Would you believe that when they attempted to fly home a few days later, their flight was also overbooked? This time, when the airline asked for volunteers, the Hawley family declined. They decided not to press their luck: After all, earning 20 free tickets for one trip was more than enough. And besides, they just wanted to get home.