Southwest Airlines sending ‘gratitude pay’ to workers after holiday meltdown
Southwest Airlines is sending millions of dollars in ‘gratitude pay’ to workers after the historical meltdown that led to 16,700 flight cancellations in late December.
Pilots are among “several operational workgroups” offered the bonus pay for their efforts during the “unprecedented disruptions over the holidays,” said Southwest Airlines spokeswoman Brandy King, although the company would not disclose exactly which workgroups were given the bonuses or the total payout.
The Dallas-based carrier’s union of 10,000 pilots will take in “approximately $45 million” in additional pay, on top of extra pay already given for holidays and reassignment pay. That would equal nearly $4,500 per pilot. The Southwest Airlines Pilots Association voted to accept the pay bonus Thursday.
Employees across the company should see the bonuses on their paychecks starting in late February.
Southwest has already put a $725 million to $825 million estimate on the lost revenue and other costs placed on the late December breakdown, including refund and reimbursements for customers, $300 in flight credits for passengers disrupted and about $400 in credits to the company store for employees.
The company said this new round of pay bonuses is already accounted for as part of that previous estimate. The company reports its fourth quarter and full-year 2022 earnings on Jan. 26.
Southwest suffered a catastrophic operational stretch starting Dec. 22 when a winter storm blew across the U.S. and hit key airports in Chicago and Denver. With two major crew bases out, the company’s crew rescheduling software struggled to keep up with the need to put pilots and flight attendants on new flights and the company eventually lost track of thousands of workers.
The bonus pay applies to those who worked shifts between Dec. 20 and Jan. 3.
As pilots and flight attendants were desperately trying to get through to the company to get assigned to flights, the company canceled as many as 75% of its flights during the peak because there were no crew members assigned to work them.
CEO Bob Jordan has repeatedly apologized to employees and promised to work to make sure that a similar meltdown never happens again.
“I’m not excusing what happened,” Jordan said last week. “I mean, we messed up for our customers. We messed up for our people.”
Southwest has hired third-party consulting firm Oliver Wyman to research the cause of the problem and possible solutions and the carrier is also worked with GE, who supplies the crew scheduling software, on an update to fix the issues behind the cancellations.
“I’m sorry for the physical and emotional toll,” Jordan said in a memo to employees last week with the offer of credits to the company’s store. “I’m sorry for the loss of time and memories that can never be replaced. Most of all, I’m sorry about the damage to your confidence and trust.”
