Moneybox

Southwest Owes Passengers Refunds. This Is What They’ve Been Doing Instead.

The Department of Transportation has clear rules about how to handle cancellations.

Tons of suitcases at an airport.
Unclaimed luggage at the William P. Hobby Airport on Wednesday in Houston. Brandon Bell/Getty Images

Andrea Minor is so well-versed in airline passenger rights that she can recite federal code. On Monday, when a ticket agent in Austin informed her that her flight back to El Paso had been canceled, she knew what to ask for.

She expected a refund for the remainder of her Southwest trip, she said as politely but firmly as she could. There was no way she and her daughter were going to stay in Austin, their layover city, until Saturday, the next date Southwest had availability. Her 71-year-old mother back in El Paso was sick and so she planned to fly with another airline that would get her there sooner.

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The Southwest agent listened, Minor recalled in a phone interview, and then proceeded to print out two vouchers for $200 each that she could use to buy a future ticket on Southwest.

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A rectangular piece of paper in the shape of an airline ticket. At the top it says "Southwest LUV Voucher." The balance is shown as $200.
This is what Andrea Minor got instead of a refund.   Andrea Minor
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Minor explained that she would never fly Southwest again—so she wanted an actual refund. Vouchers were the best she could do, the agent told her. Minor also requested a hotel voucher; the staff had run out earlier that day, the agent said.

By refusing to offer Minor a refund, the company was blatantly violating Department of Transportation rules, something additional interviews show they have been doing over and over again this week.

Between Dec. 23 and Dec. 27, Southwest Airlines canceled nearly 10,000 flights, more than 50 percent of its schedule, according to FlightAware, a flight tracking company. Southwest has apologized, blaming its “operational challenges” on the way severe weather intersected with its scheduling tool. Social media is brimming with so many heartbreaking stories of obliterated holiday plans that it would be easy to categorize refund challenges such as Minor’s as just another infuriating detail. But it’s more serious than that.

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All airlines are required by federal law to give customers full refunds—not credits—when they cancel flights for any reason.* Southwest is also one of many airlines that have publicly committed to covering the cost of a hotel stay when they are responsible for the cancellation.

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The refund rule is not an obscure point buried in ancient contracts; it’s a standard that Pete Buttigieg, the secretary of transportation, has emphasized repeatedly throughout the past couple of years in response to airlines’ well-documented tendencies to give customers flight credits that they’ll never use. The Department of Transportation highlighted the rule in November, when it announced that the agency had just fined six airlines for breaking it: “Under U.S. law, airlines and ticket agents have a legal obligation to refund consumers if the airline cancels or significantly changes a flight to, from and within the United States, and the passenger does not wish to accept the alternative offered. It is unlawful for an airline to refuse refunds and instead provide vouchers to such consumers.” Beyond occasional fines, the Department of Transportation has taken the stance that educating customers about their rights should encourage airlines to behave better.

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But Minor’s and other travelers’ experiences from the past few days illustrate why the current approach is insufficient. Minor knew her rights. Leadership knew the rules. And still, a customer service agent tried to placate a traveler with a gift card.

“They should be ashamed of themselves,” Minor said of Southwest.

But what about all that snow? Some people were calling it the “blizzard of the century,” after all. Is it really fair to say this mess was within Southwest’s control? Or even if it was, isn’t it possible that some Southwest employees didn’t know that? These questions matter because Southwest does not have to provide hotel vouchers if something outside its control or cover the cost of ground transportation—like weather—caused the mess.

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For Minor, who works in IT, there is little ambiguity. The agent who refused her refund blamed the cancellations on a malfunctioning scheduling system.

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In other cases, there may have been more confusion.

Samantha Luna and four family members were supposed to spend Christmas in Las Vegas. Instead they spent $2,500 to sleep in Kansas City, their layover destination, and purchase tickets on another airline back to New York. When Luna tried to get a hotel voucher for her family, an agent told her, “Southwest can’t control the weather,” she said.

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“Weather keeps airlines from taking responsibility,” observed April Proveaux, whose family spent Christmas eating microwavable meals at an airport hotel in Denver.

Paul Hudson, the president of Flyersrights.org, a consumer advocacy group, agrees with Proveaux.  Airlines often blame weather when it’s actually human error interacting with nature, he said.

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Airlines do not simply engage in weather gaslighting in person; they do it with technology.

On Monday, Southwest’s chief operating officer, Andrew Watterson, acknowledged that the company’s scheduling software was the primary culprit, according to CNN. Simultaneously, the app continued to nudge some customers away from a refund.

Take the example of Luke Perrin,  a student at Duke’s divinity and public policy schools.  His flight to Portland was canceled on Tuesday morning. For some passengers, the app contained two options for reimbursement:  “refund to credit card” or “hold for future use.”

A screenshot of Southwest's app. It shows an itinerary of a flight scheduled for December 28. There's a button that says "cancel flight" and two options appear: "refund to credit card" and "hold for future use."
These two options appeared for some people, including one Slate podcaster’s mother.  Screenshot by Slate
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But Perrin only got the second option, he told me:

A screenshot of page in Southwest's app. The top of the screen says "cancel flight". The total cost of the flight is shown as $436, and below that number it says "hold for future use." There is no way to select another option.
Luke Perrin was among the travelers who could only select “hold for future use.” Luke Perrin
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Others shared similar experiences. Deanna Chase, a novelist based in New Orleans, landed on a screen that said that she was only eligible for credit because of her fare type. (Fare type should not impact a refund in this situation.)

Of course it’s totally possible that app deficiencies were not intentional.

When I asked Southwest if travelers whose flights had been canceled in recent days were entitled to refunds, a spokesman said yes. “Any traveler whose flight was canceled can request a refund. That is our policy any time a flight is canceled,” he wrote. Requests for hotels and meal reimbursement would be “reviewed on a case-by-case basis,” he added.

And in Southwest’s defense, the airline did email Perrin a link to a page where he can request a refund, we learned when I asked him to dig through his inbox.

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A screenshot of an email from Southwest. It says "Irregular operations" in bold at the top, and has a paragraph of text outlining the situation. At the bottom of the portion of the email in the screenshot, the text directs customers to a link where they can submit a request for a refund.
Luke Perrin
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But spend a few minutes on social media and it’s clear that many people never saw that link. Even Minor, who was kind enough to share the Department of Transportation’s policy with other passengers, had not seen it until I sent it to her. Southwest’s failure to direct ticket agents to offer the option of a refund in person, and to make that option consistently clear within the app, does not square with the spirit of the rules.

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On Tuesday, Secretary Buttigieg told the CEO of Southwest Airlines that the company needed to provide “meal vouchers, refunds, and hotel accommodations for those experiencing significant delays or cancellations that came about as a result of Southwest’s decisions and actions,” a representative for the Department of Transportation said in a statement provided to media. “The Department will take action to hold Southwest accountable if it fails to fulfill its obligations” the statement said.

But more immediately, thousands of people need to get their money.  So here’s that all-important link, once again.

Correction, Dec. 29, 2022: An earlier version of this article misstated that airlines only have to refund customers if they are responsible for the cancellation. Airlines are supposed to give customers the option to be fully refunded, regardless of what caused the cancellation. The reason for the cancellation does impact other compensation, such as hotel vouchers, the airline is supposed to offer.

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