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Sunday, July 14, 2024 | Back issues
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American Airline Retirees Sue Union for Stock

FORT WORTH (CN) - Recent retirees of American Airlines claim in a class action that their union refuses to deliver $32.5 million in stock that induced their early retirements.

Lead plaintiff Thomas A. Powell sued the Transport Workers Union of America, the AFL-CIO and 15 TWU locals in Federal Court.

Powell claims the TWU, American Airlines and American Eagle agreed to modify their collective bargaining agreement in August 2012.

In exchange for the union agreeing to voluntarily retirements, the airlines promised it equity in the new American Airlines Group, after they emerged from bankruptcy. Powell says employees were then induced by a second, "interlocking" program to take early retirements in exchange for interests in the stock.

The union agreed to the voluntary retirements to avoid involuntary furloughs.

The defendant union locals required employees to decide immediately whether to retire rather than simultaneously offer both early separation and stock, the complaint states.

"It was not until August 2013 that the defendants informed the persons who took early separation that defendants had decided to deny plaintiff and the proposed class their previously vested rights to the TWU equity," the 22-page complaint states.

"The defendants did this in direct contravention of advice from the TWU International president."

Powell claims that anyone who took early retirement before July 26, 2013, was denied rights to the stock. He claims the pilots and flight attendants unions, who previously settled their collective bargaining agreements as well, did not exclude departing employees from their stock.

Powell says he appealed the defendants' decision in September 2013, and the defendants' appeals committee said the appeals would be decided in 30 days.

"The appeals committee however failed to even acknowledge Powell's letter, request any further information, or otherwise explain to Powell the reason why it did not respond to his letter for over 60 days," the complaint states.

"On December 2, 2013, Powell received a letter from the committee informing him that his appeal was denied. The letter was devoid of any reasoning or analysis other than repetition of the eligibility criteria that had been announced in August 2013." The TWU could not be reached for comment on the lawsuit Sunday.

Powell seeks class certification, an injunction blocking distribution of the stock, and damages for breach of duty of fair representation.

He is represented by Keith Verges with Figari Davenport in Dallas.

Follow @davejourno
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