Summary of the Lawsuit
This lawsuit alleged that United Airlines, Inc. failed to make contributions to its pilots’ accounts into the United pension plan for periods of military leave based on each pilot’s 12-month average earnings before the period of military leave, as required by USERRA. This lawsuit was filed against United Airlines, Inc. on behalf of a class of 1,160 United pilots who served in the military from 2000 to 2010 and who did not receive their pension contributions required by the Uniformed Services Employment and Reemployment Rights Act (“USERRA”), a federal law that protects veterans’ employment rights. The action, Tuten v. United Airlines, Inc., 1:12-cv-01561-WJM-MEH (D. Colo.), was filed on June 15, 2012, and a settlement with United Airlines, Inc. which required payment of $6.15 million plus non-monetary prospective relief, was reached on August 14, 2013.
Summary of the Claims
The Complaint alleged that from 2000 to 2010 United failed to make contributions to its pilots’ accounts into the United pension plan, the Pilots’ Directed Account Retirement Income Plan (“PDAP”) for periods of military leave based on each pilot’s 12-month average earnings before the period of military leave, as required by USERRA. Instead, the Complaint alleged that United had a policy of making pension contributions based on the minimum monthly flight hours guaranteed under the pilots’ collective bargaining agreement. As a result, the Complaint alleged that United pilots who took military leave from 2000 to 2010 did not receive the full amount of pension contributions to their PDAP accounts.
The Settlement Class was defined as former or current Legacy United pilots:
- who were participants in the PDAP between January 1, 2000 and October 31, 2010; and
- who were on Long Term Military Leave that began and ended between January 1, 2000 and October 31, 2010; and
- on whose behalf United made defined contribution retirement plan contributions based on the monthly minimum flight hours guaranteed under the pilot’s CBS; and
- whose average flight hours during the 12-month period that immediately preceded a period of Long Term Military Leave (or, if shorter than 12 months, the period of employment immediately preceding such period of military leave) exceeded the monthly minimum flight hours guaranteed under the pilots’ CBA. (The monthly minimum flight hours guaranteed were 75 hours from 2000 to May 2003, and 70 hours from May 2003 to November 2010).
Excluded from the Proposed Settlement Class are all former or current pilots who previously reached settlements with or judgments against United in their individual USERRA claims or actions concerning inadequate retirement plan contributions for periods of military leave.
History of the Litigation
The Complaint was filed on June 15, 2012. Shortly after the Complaint was filed, United expressed an interest in resolving the case. On August 11, 2012, the Parties agreed to seek a stay of the case and during the next several months, United provided Class Counsel with substantial informal discovery. On March 27, 2013, the Parties entered into a Settlement in Principle, and entered into a formal Settlement Agreement on August 14, 2013. On October 31, 2013, the Court entered an order certifying the case as a class action and giving preliminary approval to the settlement. After providing members of the Class with an opportunity to accept or challenge the data provided by United about their leave and other relevant data used to calculate their damages, and/or comment on or object to the settlement, the Court held a hearing on final approval of the settlement on May 16, 2014. The Court entered an order finally approving the settlement on May 19, 2014. The settlement became effective on May 20, 2014.
United agreed to pay $6,150,000.00, distributed on a pro rata basis to Class Members (after any award of attorneys’ fees and reimbursement of expenses and any service award to the Class Representative) into their PDAP accounts to the extent that such distributions can be made consistent with IRS regulations to each Class Member’s PDAP accounts.
United also agreed as part of this Settlement to institute the following changes to current policies and practices effective as of July 18, 2014:
- United’s policy regarding its contributions to the PDAP for pilots who take and return from Long Term Military Leave will be calculated consistent with the following: (1) the pilot’s “monthly average number of hours worked” will be based on all of the prior 12 months for which United has personnel data, (2) the number of hours worked each month used to calculate the 12 month average will include all short-term (fewer than 30 consecutive days) military leave hours for which the pilot received pay and all short-term military leave hours for which the pilot did not receive pay, and (3) for the purpose of calculating the monthly average number of hours worked, United shall credit unpaid short term military leave in the same manner as it currently credits unpaid short term military leave for the purpose of making pension contributions during a month in which a pilot works part of the month and takes unpaid short term military leave.
- United will maintain a written policy setting forth how defined contribution plan contributions for pilots on Long-Term Military Leave are made which will be published in places readily available to pilots, and made readily available upon request. The PDAP Plan Administrator and any third-party administrator will also be instructed to comply with the new policy requirements.
- United will make contributions to its pilot’s defined contribution plan on behalf of a pilot returning from Long Term Military Leave, and provide notice to the pilot that describes data and methodology that were used to calculate the make-up contribution for each month during the period of Long Term Military Leave.
- When a pilot provides United written notice of an intent to take Long Term Military Leave, United shall, no later than 30 days of such written notice, provide the pilot with a written estimate of the pilots “monthly average number of hours worked” over the 12 months preceding such notice and provide the pilot with a copy of United’s policy for making defined contribution plan contributions for pilots on Long Term Military Leave.
For more information about the settlement, visit http://www.unitedpilotsclassaction.com
Whom to Contact for More Information
If you have questions about this case or have a circumstance similar to this case, please contact one of the following:
COHEN MILSTEIN, SELLERS & TOLL PLLC
1100 New York Avenue, NW, Suite 500
Washington, D.C. 20005
Cohen Milstein was co-counsel in this litigation with Thomas Jarrad, of the Law Offices of Thomas G. Jarrard, Matthew Crotty of Crotty & Sons, and Robert W. Mitchell.