Southwest Airlines is being fined $140 million by the federal government for last year's holiday meltdown that left over 2 million travelers stranded. The Department of Transportation (DOT) announced its largest ever civil penalty, which comes a year after Southwest canceled nearly 17,000 flights, accounting for almost half of its holiday flight schedule. The fine was imposed for multiple violations of consumer protection laws, including lack of communication with passengers, inadequate customer service, and delayed refunds. Southwest has already paid $600 million in refunds and reimbursements to passengers. The airline reported that the service meltdown cost them nearly $1.2 billion in the fourth quarter of last year and the first two months of 2023. The fine will create a $90 million fund to compensate future Southwest passengers affected by cancellations or significant delays, with only $35 million being paid to the US Treasury. Transportation Secretary Pete Buttigieg stated that the fine sets a new precedent and sends a message to other carriers. Labor unions at Southwest blamed the problems on outdated scheduling technology, which made it challenging to adjust flight schedules and have available crews. Southwest executives admitted the scheduling system was a problem and stated that they had taken steps to fix the issue. They also acknowledged other mistakes, such as a lack of de-icing equipment at certain airports. Southwest CEO Bob Jordan assured that the airline had improved its internal controls and technology investments to prevent similar problems in the future.
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