Company may be resigned to paying for ex-employee’s airfare
Question: As a human resources consultant, I sometimes receive travel inquiries from one of my clients. Here is one: An employee, using a company credit card, purchased a $1,200 airline ticket for a business trip. The ticket is in her name and is nontransferable. She then resigned from the company, and the company (which is paying for the ticket) contacted the airline. The airline initially told them there was no problem but later said no changes (regardless of fees paid) could be made to the ticket and even added the comment “Guess you just gave your former employee a nice trip.” While my client understands that advance tickets have restrictions, it seems impossible that the change of employee name (with change fee) cannot be implemented and that the ticket, paid for by the company, remains in the possession of, and for exclusive use by, the former employee. Can you help?
Answer: Here are words I never thought I’d say: The airline is right. The client bought that now-ex-employee a ticket to paradise (if paradise is $1,200 away).
The only consolation isn’t much consolation: If the employee is going someplace besides the original destination, she will have to pay a change fee, which can be as much as $250. That’s not exactly the soul-satisfying raspberry that one might like to give.
The issue becomes clear in this sentence: “The ticket is in her name and is nontransferable.” The airline’s contract of carriage (it happens to be United) says this: “Tickets are not transferable unless otherwise stated on the ticket at the time it was issued.” People buy nontransferable tickets because they are usually the least expensive. For instance, the cost last week of an unrestricted round-trip ticket from LAX to Washington Dulles for June 12 to 19 on United was $1,732. The lowest fare I found for those dates on United: $365. (These fares may be long gone by the time you read this.) The first is refundable and may be transferable; the lowest price is not. Because ticket terminology may differ from airline to airline, be sure to check with the airline before booking that more expensive ticket, just to be sure of the rules.
If the airlines can’t help, can Lady Justice help?
“There’s not a whole lot of legal recourse against that employee,” said Brian Inamine, a lawyer with the L.A. office of LeClairRyan, who noted that California is very protective of employees.
What about withholding the $1,200 from the final paycheck?
Nope. “That would be an improper deduction, and it could place the employer at risk for penalties under California law,” said Alex Craigie, an employment lawyer with Dykema Gossett in Los Angeles.
OK, what if the employee knew she was leaving and took the ticket anyway? Isn’t that fraud?
“I guess you could claim some sort of fraud, but it’s likely going to cost you more than the value of the ticket,” said Carrie Hoffman, a partner at Gardere Wynne Sewell in Dallas.
How about small claims court?
“In small claims, you may win [or] you may lose,” said Anthony Oncidi, a management-side lawyer and head of global law firm Proskauer’s California Labor and Employment Law Group. In the end, Oncidi and others agreed, it’s probably not worth going to court.
But, all agreed, there is one last glimmer of hope: The employer can try to negotiate with the employee for the value of the ticket, without anger, without malice and without heavy-handed tactics. (Guilt sometimes works wonders.)
What to do so this doesn’t happen again? Bite the bullet and buy refundable fares. Or assume the risk and know that you may have to eat the cost of a ticket.
Amy Burton Loggins, an attorney at Atlanta-based Taylor English Duma, said in an email: “Some companies work through a travel agent or company.... With this scenario, if the company uses a travel agent, it may be able to transfer the credit from one employee to another depending on the contract between the company and agent.”
Perhaps the most ingenious response was from Tyler L. Barnett, president of Tyler Barnett Public Relations in Los Angeles: “I always use company miles to book employee tickets. This way, there is no value to the ticket, and it can be canceled through my account without having to worry about it being used.”
But absent a pool of miles? You’re swimming in deep water. Which is pretty much where most people find themselves whenever they have a problem with an airline ticket. Without a complete understanding of fare structures, most of us are shark bait.
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