Court Dismisses United Retirees' Union Contract Suit

June 2, 2003 ( - United Airlines passenger contact employees, who allege union misrepresentation in an early retirement deal, may not sue the union for breach of the common law duty of fair representation or for promissory estoppel.

>US District Judge Robert Lasnik of the US District Court for the Western District of Washington granted the International Association of Machinists District 141’s motion to dismiss, after determining the retirees’ state common-law claims are preempted by the Railway Labor Act (RLA), which covers labor relations in the airline industry. Upon the jurisdiction ruling, the judge further ruled the retirees missed the six-month deadline for filing a breach of fair representation claim under the RLA in Flathau v. International Association of Machinists District 141 , according to Washington-based legal publisher BNA.

Promises, Promises

>The case stemmed from an early retirement package offered to certain United workers in the wake of the September 11, 2001 terrorist attacks. Twelve passenger contact employees accepted the package and later sued, alleging that the union’s statements regarding the capping of the retirees’ medical insurance premiums and improvements in the next contract were misleading.

>Early retirement was accepted by the dozen Seattle area-based passenger contact employees in the fall of 2001. On May 14, 2002, United and the union agreed on a new contract that did not cap retirees’ medical insurance premiums or provide exactly the same level of benefits as active employees.

>The retirees sued in federal district court on November 1, 2002, alleging breach of the duty of fair representation under the RLA. However, that suit was later voluntarily dismissed, as the retirees opted for a lawsuit in King County Superior Court in January 2003, alleging breach of the common law duty of fair representation and promissory estoppel. The union removed the case to federal court, arguing that the state law claims were preempted by the RLA.

Fair Representation

>Under the RLA, a union that is the exclusive bargaining representative of a group of workers owes them a duty of fair representation, the court said. “When a plaintiff’s claims are based on the union’s failure adequately to represent her, the claims are preempted by the federal labor law governing the union’s representation of the plaintiff.”   Therefore, the retirees’ claims of a union violation of common law duty of fair representation by failing to obtain a cap on medical insurance premiums and discriminating against retirees and in favor of current employees “fall within the ambit of the federal duty of fair representation” and thus, are preempted by the RLA, the court ruled.

>The promissory estoppel claim involved the retirees’ allegations that they reasonably relied to their detriment on the assurances and promises made to them by the union. The retirees argued that this claim was not preempted because deciding it does not require interpretation of a collective bargaining agreement. However, the court found that the promissory estoppel claim was preempted because it came “within the ambit of the [RLA] duty of fair representation.”

>The six-month statute of limitations for bringing a duty of fair representation claim under the RLA “begins to run when the plaintiff knows of or should have known about the defendant’s alleged wrongdoing,” the court said. In this case, the retirees should have known about the union’s alleged wrongdoing when the new contract was signed on May 14, 2002, the court found.   Because the retirees filed the present suit more than eight months later, an RLA claim is time barred, the judge ruled.

The case is Flathau v. International Association of Machinists District 141 , W.D. Wash., No. C03-0278L, 5/14/03.