3rd Circuit Stays Order for FreightCar America to Rehire Employees

March 10, 2008 (PLANSPONSOR.com) - A federal appellate court has put on hold an order by a federal judge in Pennsylvania mandating that a Chicago-based railcar manufacturer rehire laid-off workers so they can claim their proper pension benefits.

Circuit Judge Thomas L. Ambro, in writing for the 3 rd  U.S. Circuit Court of Appeals, ordered that the decision by U.S. District Judge Kim Gibson of the U.S. District Court for the Western District of Pennsylvania be stayed until the Philadelphia-based appellate court can hear the appeal by FreightCar America.

In January, Gibson had ordered the reinstatement of more than 100 workers after ruling that the ex-employees had put forward strong enough evidence in support of their claims the company laid them off to avoid paying pension benefits to which they were entitled under a union contract expiring in May 2008. For its part, the company contended it laid off the employees as part of its plan to close its Johnstown, Pennsylvania, facility in a cost-cutting move (See Rail Car Maker Ordered to Rehire Workers to get Pension Benefits ).

Ambro’s order also prohibits the closing of the Johnston facility while the appeal is pending.

In a statement announcing the 3 rd  Circuit stay, Tom McCarthy, FreightCar America Senior Vice President, Human Resources, asserted, “The layoffs at our Johnstown plant during 2007 resulted from a downturn in railcar demand. Our actions were appropriate and we will continue to defend them vigorously as this litigation proceeds.”

The appellate court order is  here .