Southwest Airlines will pay a $35 million fine as part of a $140 million settlement reached with the U.S. Department of Transportation (DOT) after the cancellation of nearly 17,000 flights left more than two million travelers stranded during last year’s chaotic holiday season.
Most of the penalty, which is 30 times higher than any other penalty in DOT history, will go toward compensating future Southwest riders affected by significant cancellations or delays, the DOT said.
“Today’s action sets a new precedent and sends a clear message: If airlines neglect their passengers, we will use the full extent of our authority to hold them accountable,” said the US Transportation Secretary, Pete Buttigieg. “Caring for passengers is not only the right thing to do, it is necessary, and this penalty should incentivize all airlines to take every step possible to ensure that a collapse like this does not happen again Never.”
Southwest said it was “grateful to have reached a consumer-friendly settlement” giving the airline credit for compensation it had already paid to its customers. The airline said it had “learned from the event and can now fully focus on the future”.
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Southwest canceled about 16,700 flights in the last 10 days of December 2022. The crisis began with a winter storm, but Southwest continued to struggle long after most other airlines had recovered, in part because its crew scheduling system had become overloaded.
During its investigation, the DOT said it found that Southwest violated consumer protection laws by failing to provide adequate customer service, leaving travelers stranded at airports and hotels rushing to other flights and accommodation.
Many customers who called Southwest’s call center for help were met with a busy dial tone or were left on hold for hours.
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Southwest also failed to provide its customers with timely flight status notifications. Many travelers received no updates about their flights and only learned of the cancellations after arriving at the airport.
The DOT also said Southwest failed to refund thousands of customers quickly enough. Those who submitted claims on a South West website encountered errors that prevented them from receiving their refunds, and others did not receive immediate reimbursement for services such as travel fees. pets or a boarding upgrade that was never used due to cancellations.
|SOUTHWEST AIRLINES CO.
In addition to the $35 million fine, the settlement will allow Southwest to obtain a credit of $33 million for compensation already paid, mainly for granting 25,000 frequent flyer points each to affected customers.
The company also promised to distribute $90 million in vouchers to future travelers, with the airline receiving a $72 million credit for future vouchers.
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In exchange for Southwest agreeing to the fine and other measures, the government did not go so far as to decide whether the airline announced a flight schedule that it knew could not be met .