As travel starts to pick up ahead of the holidays, Southwest Airlines is still facing fallout from a meltdown last year that resulted in thousands of canceled flights and millions of stranded passengers.

The U.S. Department of Transportation on Monday announced a $140 million civil penalty against Southwest Airlines for operational failures and violations of consumer protection laws during the 2022 holiday season. As part of the settlement, the airline will set aside $90 million to compensate future passengers impacted by delays and cancellations, according to a release.

“Taking care of passengers is not just the right thing to do — it’s required, and this penalty should put all airlines on notice to take every step possible to ensure that a meltdown like this never happens again,” said U.S. Transportation Secretary Pete Buttigieg in a statement.

Southwest canceled or significantly delayed more than 16,000 flights last December — including many at Baltimore-Washington International Thurgood Marshall Airport — leaving more than 2 million passengers stranded nationwide, according to the DOT’s investigation. Southwest officials attributed the fiasco to a cascade of factors, including a winter storm and outdated crew-tracking technology.

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Under the new compensation policy, the airline will offer vouchers worth $75 or more for “controllable cancellations and delays that cause Customers to reach their final destinations three or more hours after their scheduled arrival,” the company said in a release. The policy is expected to be implemented by April 30, 2024.

A large portion of the $140 million civil penalty against Southwest will be offset by the creation of the new compensation policy, with the airline also receiving credit for already issuing rewards points to impacted passengers. Southwest will pay the government $35 million.

In a statement on Monday, Southwest CEO Bob Jordan said the airline has spent the past year focused on efforts to “accelerate operational resiliency, enhance cross-team collaboration and bolster overall preparedness for winter operations.”

BWI is the fourth-largest hub in the Southwest network, and the airline makes up a large chunk of its daily flights. BWI is expecting a busy holiday travel season and says on its website that people should arrive two hours early for domestic flights and three hours early for international flights.

Carrie Mihalcik is an editor on the Express Desk at The Baltimore Banner focused on breaking and trending news. 

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