Setting the record straight

Mark Pestronk

Instead of the usual Q&A column, let me take this year-end opportunity to correct a couple of my statements and amplify a few others based on readers’ comments this year.

• I have encouraged agencies to have their clients pay suppliers by credit card so that the credit card company will process refunds if the supplier goes out of business. For example, in connection with the Crystal Cruises crisis, I wrote that the credit card companies “nearly always” provide a refund, even if it is not strictly required under the Fair Credit Billing Act.

Based on readers’ comments on my columns about Crystal, “nearly always” appears to be an overstatement. Some travelers have found that their card companies have refused to provide a refund on the grounds that the charge occurred “too long” before the Crystal insolvency case.

The Fair Credit Billing Act requires card issuers to make refunds only if a cardholder disputes the charge within 60 days after receiving a credit card statement. So travelers who paid, say, six months in advance of their anticipated cruise have no legal rights under the act and depend on the goodwill of the card issuer.

• Speaking of Crystal Cruises, I recently wrote that the amount available to satisfy the claims of creditors was about $3 million. On the same week that my column appeared, the “assignee” in the insolvency case told the court that he had collected roughly $13.1 million in assets belonging to Crystal.

• In my Oct. 24 column, “You can probably sell your client database,” I noted that the U.S. lacks federal and state laws that restrict the sale of anyone’s travel data. Tina Logan of Northstar Travel Group (Travel Weekly’s publisher) wrote me to point out that I should have mentioned a company’s privacy policy. 

If your online privacy policy states or implies that you do not sell the client’s data and you do it anyway, you are breaking federal law because the Federal Trade Commission considers such a practice unfair and deceptive.

• In response to the Department of Labor’s proposed rule that would require independent contractor relationships to meet six criteria, I dwelled on the one that could reclassify the relationship as one of employment if “the worker performs the same work that an employer performs.”

I stated that many if not most host-IC relationships would not pass muster under this criterion. So, those ICs were at risk of being reclassified as employees for federal labor law purposes.

Although I did state that the “same work” criterion is only one of six and that all criteria will be considered in a Labor Department audit, in retrospect I think I was a bit of an alarmist. First, the proposal is just that, and adoption is uncertain and in any case a long way off. Second, the Biden administration probably has no intention of targeting the retail travel business, as it wants to go after companies that exploit their workers.

So it may be too early to change your host-IC relationships based on the proposed rule. 

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