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Jetstar has been fined $2.25 million today for misleading nearly 100,000 customers about their compensation rights.

The airline claimed the Covid-19 pandemic caused it to lay off experienced workers and replace them with inexperienced staff who provided flyers with the wrong advice.

The offending happened between January 2022 and March 2024 and the Commerce Commission prosecuted the airline.

At Auckland District Court, the airline faced 20 charges of breaching the Fair Trading Act.

“The breaches of aviation law were in relation to compensation for flight cancellations and delays,” Judge Brooke Gibson said.

He said about 98,000 passengers were affected in New Zealand by flight cancellations within Jetstar’s control.

Compensation was not available in excess of monetary caps Jetstar imposed.

The airline in this case also refused to provide affected people overnight accommodation unless the airport was not their home town or was more than 15km from home.

Only a Jetstar recovery flight or refund of the unused ticket were available.

The judge said Jetstar did not meet legal requirements for refunding customers when flights were cancelled for reasons within the airline’s control.

The airline had claimed some experienced agents were retrenched during Covid-19 and replaced with inexperienced agents.

“That may be so but of course it’s no defence,” Judge Gibson said.

“There were also contradictory instructions on the documents” staff used to advise people about refunds, he added.

He said an agreed starting point was a $2.5m fine.

Jetstar received a 10% discount for having no prior New Zealand convictions and a 25% discount for pleading guilty.

But an uplift was imposed for Jetstar’s financial capacity - in other words, the judge decided it was a substantial company with the ability to pay a fine.

Judge Gibson decided on a $2.25m penalty.

The sentencing was to be held last week but was pushed back to today.

On August 21, prosecutor Jacob Barry said there was no dispute that the case involved “reckless offending by a corporate of substantial means”.

Jetstar counsel Joe Edwards said the airline was sorry and had installed new systems to ensure no repeat of the offending.

The case has already led to Jetstar refunding more than $1m and paying $860,000 to an unnamed children’s charity.