DALLAS- Southwest Airlines (WN) is announcing today that it has reached a comprehensive resolution with the Department of Transportation (DOT) regarding the DOT’s investigation into the disruption caused by Winter Storm Elliot in December 2022.
The complete Consent Order, including Southwest’s stance on the DOT’s inquiry, can be accessed through this link.
Southwest Airlines Fined by DOT
The Department of Transportation (DOT) has declared a civil penalty of $140 million against Southwest Airlines for numerous infractions of consumer protection laws arising from operational failures in late 2022. The primary allocation of this penalty will be directed toward compensating future Southwest passengers affected by cancellations or significant delays.
Southwest shares the DOT’s objective of providing the highest standard of service to the traveling public and is pleased to have reached a consumer-friendly settlement. This settlement acknowledges past compensation efforts that exceeded requirements for customers and establishes a new industry-leading compensation policy for Southwest Customer Care in the future.
The remaining terms of the agreement will be fulfilled through a one-time $35 million cash payment disbursed over a three-year period to the DOT.
Southwest is grateful for the acknowledgment that it acted swiftly to assist customers, learned valuable lessons from the event, and can now refocus entirely on the future.
Holiday Meltdown in 2022
During the Winter Storm Elliot disruption, Southwest expressed apologies for the inconvenience and promptly took measures to address the needs of both customers and employees, striving to uphold its own high standards of customer service and comply with regulatory requirements.
Despite facing unprecedented operational challenges tied to the surge in volume, Southwest acted diligently and in good faith.
The airline swiftly implemented various initiatives across its operations to cater to customers:
The volume of incoming calls during Winter Storm Elliot far exceeded any previous demand. In response, Southwest rapidly expanded call center capacity, working diligently to assist the exceptionally high number of customers seeking help.
Regular updates were provided to customers about the above-average wait times, and they were directed to additional channels for reaching Southwest representatives or obtaining information.
Ticket Refunds and Expense Reimbursements:
Southwest facilitated over $600 million in ticket refunds, expense reimbursements, and goodwill gestures both during and after the disruption. An all-hands-on-deck effort processed refund requests promptly, with volunteers mobilized to handle the majority within the DOT-prescribed seven-day timeframe.
A dedicated microsite was quickly created to serve as an extra channel for managing refund requests. Customers were allowed to rebook travel at no extra cost, and Southwest approved all reasonable reimbursement requests for out-of-pocket expenses incurred due to circumstances beyond the airline’s control.
As a goodwill gesture, the company awarded 25,000 Rapid Rewards points (approximately $300 in value) to all customers affected by canceled or significantly delayed flights during the disruption.
Flight Status Notifications:
Southwest made every effort to promptly notify customers of flight disruptions through various communication channels, utilizing third-party vendors to expedite Automated Outbound Messaging (AOM). Temporary delays occurred in many AOM notifications due to the high volume of triggered messages over a short period.
Nonetheless, the majority of passengers received flight updates at least four hours before their scheduled departure. Upon identifying the delay in message delivery, Southwest collaborated with vendors to enhance capacity. Since the disruption, Southwest has upgraded customer communication tools and phone system capacity, designed to manage substantial increases in volume more effectively.
Since the disruption, Southwest has undertaken numerous measures to enhance customer care and operational resilience, as evidenced by operational improvements outlined in the airline’s completed Disruption Action Plan earlier this year.
Throughout 2023, including busy holiday travel periods such as Thanksgiving, Southwest has consistently delivered strong operational performances, with ongoing investments aimed at improving reliability for both customers and employees.
Additionally, Southwest has initiated a comprehensive transformation of its Customer Experience, successfully implementing various initiatives, including:
- Digital bag tracking for real-time information on the journey of checked items.
- Flight credits with no expiration, allowing customers to retain credits for future travel.
- Enhanced digital self-service capabilities, enabling customers to request refunds if they choose not to travel due to a Southwest-initiated flight cancellation.
- Expanded rebooking options following flight cancellations.
- Proactive customer notifications during weather events, providing rebooking options.
In today’s announcement, Southwest introduces a new, industry-leading policy that offers additional compensation (in the form of a voucher of $75 or more), upon request, for controllable cancellations and delays that result in customers reaching their final destinations three or more hours after their scheduled arrival.
This policy will be implemented by April 30, 2024, showcasing Southwest’s commitment to leading the industry in compensating customers and underscoring its dedication to award-winning customer care.
“Over the past year, our dedicated focus has been on enhancing the customer experience through substantial investments and initiatives aimed at accelerating operational resiliency, fostering cross-team collaboration, and strengthening overall preparedness for winter operations,” stated Bob Jordan, President and Chief Executive Officer of Southwest Airlines.
“Our longstanding commitment to customers has been integral to our success over our 52-year history, making us one of the world’s most admired and trusted airlines.”
Southwest takes pride in its employees’ resilience, perseverance, and heartfelt dedication in caring for customers during and after the disruption caused by Winter Storm Elliott.
Southwest has been globally renowned for its emphasis on operational reliability, high-quality customer service, and legendary hospitality for over five decades—cornerstones of an ongoing commitment that will propel the company into the future.
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