The $25 million class action suit filed in federal court in Boston Friday claims the company and the Communication Workers Union Local 1365 knew that more lucrative packages would eventually be offered when the first batch of employees accepted the initial package, according to Dow Jones.
Paul Fici of Haverhill, Massachusetts, and Anthony Boremi of Salem, New Hampshire, filed the lawsuit Friday on behalf of about 450 of their fellow retirees who accepted those packages in the spring and summer of 2001, according to Dow Jones.
A few months later, more than 1,100 workers were offered and accepted a much better package that
- created a special lump sum payment up to 234% of the worker’s annual salary
- allowed workers to roll their buy-out money into their 401k retirement accounts to avoid paying taxes
- extended medical, dental and life insurance benefits an extra year
- increased education and training money
- allowed workers within five years of retirement age to take the deal
None of those features were included in the earlier buy-out offer, according to Dow Jones. The lawsuit seeks to give the retirees the same compensation as the enhanced package, which would total more than $25 million.
That Was Then
A Lucent spokeswoman said the benefits offered to workers complied with the agreements negotiated with the unions, according to the report, while Gary Nilsson, secretary of the union, said the union did not deceive workers.
Nilsson said the union tried to get the enhanced benefits for the first wave of retirees, but Lucent refused. However, when the next wave of downsizing came in September, the union lobbied for the better benefits and Lucent agreed.
According to the lawsuit, the company told the 450 workers that ‘no better benefit enhancement package was being considered by Lucent,’ while the union allegedly said it was a ‘good deal’ and recommended that its members accept it.