Case 27 Southwest Airlines

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1.0 Summary of Southwest Airlines: Does “LUV” Last?* First time in history, Southwest Airlines had its “LUV” for customers questioned. The Federal Aviation Administration (FAA) levied a record $10.2 million fine on Southwest Airlines. They accuse them after missing mandatory safety checks of flying 117 planes on nearly 60,000 flights between June 18, 2006, and March 14, 2007. Both the FAA and Southwest testified. FAA officials were blamed for being “too close” to the airline and being careless in their regulatory duties. Safety was not compromised by the missed inspections; a tiny section of the plane’s skin had missed being inspected. The cracks in that section would not have led to any terrible accident. The…show more content…
Unions were becoming more aggressive in communicating their frustration, in contrast to earlier days when differences of opinion were resolved more politely and peacefully. On 2001, ramp workers picketed near company headquarters with signs that read “Record Profits Empty Pickets”. They complained that staff shortages, combined with Southwest’s record passenger loads and its drive to improve on-time performance, meant that they had to lift more bags and had to do so more quickly, which put them at risk of injury. Though on July 2002, first time in the company history, Southwest’s mechanics union asked federal mediators to intervene to break a contract deadlock over pay. While the company was nowhere near a strike, the incident clearly signaled the strains appearing in employee relations. The company was also engaged without much success in a contract renegotiation with flight attendants. July 2003, a group of flight attendants staged a demonstration at the headquarters, carrying signs stating “Spread the LUV” and handing out cards to travelers that read “Give our flight attendants a break”. The move was an expression of frustration over management’s idea of increasing the flight attendants’ work hours. Workers who had been working hard to boost the productivity of the company were not seeing much return from profit sharing and a stock value that was
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