Continental Pilots Sue Over Pension Calculations

May 14, 2010 ( – Continental Airlines kept secret a change in how it would calculate pension benefits that shortchanged some employees, four former Continental pilots allege in a new lawsuit.

A Houston Chronicle news report said the pilots only found out about the pension calculation change after applying for retirement.

According to the news report, the issue concerns how the company treated breaks in service – leaves of absence, sick leave, etc. – in its pension determination. The suit said the company traditionally based pilots’ pension benefits on a percentage of the pilot’s salary for the 60 months before retirement regardless of taking any leave time.

The change involved the company counting leaves as interruptions of service and using instead an earlier 60-month period to calculate benefits. Depending on when a pilot received a raise, the change could produce lower benefits, the suit charged.

The pilots claimed the two sides had agreed to consider pilots’ leave time as if they were still in service, but charged that the company never told them it was not interpreting pension rules that way. Continental “kept the information secret, giving the disappointing news to pilots individually and only when they retired — only after it would be too late to affect their performance, their job demands, their retirement planning and their ability to collectively protest,” the lawsuit claims, according to the newspaper.

Continental expects the court will dismiss the allegations as unsubstantiated, said Julie King, a spokeswoman for the airline.“We are confident Continental has abided by its commitment to its pension obligations for our pilots,” King said.

Attorneys representing the pilots are seeking class-action status, saying between about 200 and 1,000 pilots were likely affected.