@united: Do You Have A Reputational Risk Policy?

While the social media firestorm following the forcible removal of a passenger from a United Airlines flight highlights the importance of crisis and reputation risk management, it also underscores the potential liability airlines face from balancing duties to their customers, employees and to shareholders.

USA Today reports that three things govern a carrier’s relationship with its passengers: contracts of carriage, the U.S. Department of Transportation and laws approved by Congress:

United’s dispute with a passenger forcible removed from a Sunday flight shines a spotlight on the contracts that set rules and expectations between carriers and travelers.

“Those contracts are well thought through. They are generally fair and balanced, and they reflect the market,” said Roy Goldberg, a partner at Steptoe & Johnson who practices aviation law in Washington, D.C. “As a general matter, passengers have rights, but airlines have rights, too.”

A Reuters analysis of federal data shows U.S. airlines are bumping passengers off flights at the lowest rate since 1995.

Many insurers and brokers offer reputational risk policies that include crisis management and PR services to assist companies before, during and after a crisis.

More on the story in today’s I.I.I. Daily, via the Wall Street Journal:

On April 11 Oscar Munoz, head of United Airlines, apologized for the forcible removal by the police of Dr. David Dao, a passenger, from United Express Flight 3411 in Chicago. The apology came two days after the altercation led to the widespread expression of anger on social media, including millions of angry posts in the airline’s rapidly growing market in China. Politicians in Washington, D.C., also condemned the airline’s forcible removal of a passenger. Munoz sent a message to employees of United Continental Holdings Inc. apologizing for an incident he characterized as horrific and acknowledging the general public outrage, which he said he shared. The message was in sharp contrast to Munoz’s initial response.

FAA guidance for planning and preparing for your next airline trip here.

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