Southwest Airlines to pay $140M for 2022 holiday travel trouble

The U.S. Department of Transportation on Monday said the agreement is the largest it has ever imposed on an airline for violating consumer protection laws. The department said Southwest failed to help passengers stranded during the last two weeks of December last year when the airline canceled nearly 17,000 flights. A significant winter storm and the airline’s crew rescheduling system contributed to a debacle lasting several days. Southwest maintained that it did not violate the law but entered into the agreement to settle the matter, according to the consent order. Southwest said in a statement that its operations so far during 2023 have been steady.

How will the $140M settlement be divided? Southwest agreed to pay the U.S. Treasury $35 million over three years. The company will be credited $33 million for issuing points to passengers impacted by last year’s debacle and receive a $72 million “offset” of its fine for setting aside about $90 million to create a compensation system for future passengers affected by delays and cancellations. Southwest previously agreed to pay an additional $600 million in refunds and reimbursements to passengers.

Dig deeper: Listen to Mary Reichard’s report on the Legal Docket podcast about a Southwest Airlines flight attendant fired for expressing pro-life beliefs.