United Airlines Settles Pilots’ Lawsuit for (At Least) $6.15 million

On June 15, 2012, the U.S. District Court for Colorado approved a settlement agreement in the class-action lawsuit Tuten v. United Airlines, Inc. Plaintiffs in the case are pilots who took “military leave” from United in order to serve in the United States armed forces between 2000 and 2010, including named Plaintiff James Daniel Tuten and others similarly situated.

The Complaint alleges that United knowingly violated USERRA, the Uniformed Services Employment and Reemployment Rights Act of 1994, by contributing less than the legally-mandated amount to the pilots’ pension fund during their service. The basic claim in the Complaint is simple: the Plaintiff alleges that United calculated its contributions to the “Directed Account Retirement Plan” (PDAP) based on the monthly minimum flight hours guaranteed under the pilots’ collective bargaining agreement, although USERRA specifies that the employer’s liability for contributions to employees’ retirement plans during their military service is “(A) at the rate the employee would have received but for the period of service…or, (B) in the case that the determination of such rate is not reasonably certain, on the basis of that employee’s average rate of compensation during the 12-month period immediately preceding such period (or, if shorter, the period of employment immediately preceding such period).” Pilots were credited for the minimum number of guaranteed work hours, but they typically worked many more hours than the minimum and the law says they must be compensated based on hours they typically work.

More specifically, the Complaint alleges that United contributed to the pension of pilots on military leave based on work schedule of 70 hours per month, the number of hours guaranteed under the terms of the collective bargaining agreement between United and the Air Line Pilots Association (ALPA). But nearly all pilots averaged many more than 70 hours per month in the 12 months prior to taking military leave, meaning that the airline paid them far less than the law requires.

United has already placed $6.15 million in an escrow account, which will be used i) to correct its deficient contributions to employees’ PDAP accounts, ii) to pay all legal fees, iii) to award a Service Award to the Class Representative, iv) to pay all administrative costs and expenses incurred by the Settlement Administrator and Settlement Adjudicator, v) to pay any costs of implementing non-monetary relief.

The last provision of the Settlement is open-ended: if the initial $ 6.15 million payment is inadequate to cover payments to additional class members, “United will be responsible for paying any additional amounts to or for Non-Responding Military Leave Class Members that they would have received under the Plan of Allocation if their challenges had been adjudicated prior to Final Approval (without regard to how their additional amount would have affected other Class Members’ additional allocations had those challenges been adjudicated prior to Final Approval.)” In other words, if the settlement amount is not adequate to completely compensate all class members, United remains on the hook for any contribution they would have been required to make under the final agreement.

If you are an employee and you believe your rights have been violated, please contact The Harman Firm, LLP.