Southwest Airlines has launched a compensation program for flight delays as part of a $140 million Department of Transportation settlement related to the carrier’s meltdown in December 2022. The airline has agreed to provide $90 million in travel vouchers of $75 or more to passengers who were delayed at least three hours due to an airline-caused issue. The program was quietly launched on April 16, and the airline has already received requests from thousands of customers seeking vouchers. This settlement comes after a chaotic holiday travel period that resulted in 16,900 flight cancellations and stranded 2 million passengers, leading to various travel horror stories.
The delay compensation program is in line with the Biden administration’s efforts to hold airlines accountable for significant flight delays and cancellations. While vouchers will be provided upon request, the administration aims to require new passenger compensation rules that would mandate cash compensation for significant controllable flight delays or cancellations. Southwest CEO Bob Jordan stated that the $30 million in vouchers annually was the appropriate amount to commit to, given the airline’s operational performance. He also mentioned that consumer programs like this one rarely change or disappear, indicating that the program may continue beyond the initial three years agreed upon as part of the settlement.
Southwest Airlines’ decision to implement the compensation program sets it apart from rival US airlines, as others have not yet introduced similar initiatives. The DOT had previously asked carriers if they would be willing to pay at least $100 for delays of at least three hours, caused by airlines, but none had agreed to do so. While most carriers have committed to providing hotels, meals, and ground transportation for airline-caused delays or cancellations, the idea of providing cash compensation, as required in the European Union, has been met with resistance. Transportation Secretary Pete Buttigieg praised Southwest for leading the market in terms of compensation requirements and expressed interest in seeing how other airlines would respond.
President Biden has signaled his support for new rules that would require airlines to compensate passengers with cash for significant flight delays or cancellations. However, the DOT has not yet issued its proposal, and Congress has not mandated compensation for delays in a pending aviation reform bill. Southwest Airlines has taken the lead in implementing the delay compensation program, prompting praise from the transportation secretary. The program will likely set a precedent for other airlines to follow suit, ushering in a new era of passenger compensation standards within the industry. Despite the challenges faced by the airline during the 2022 holiday meltdown, this initiative signifies a step towards improved customer service and accountability in the air travel sector.
