American Airlines Can't Defeat Military Benefits Suit

Law360 - Adam Lidgett

A Pennsylvania federal judge has refused to ground the bulk of a proposed class action accusing American Airlines of violating federal anti-discrimination law by failing to give pilots credit for short stints of military leave when calculating profit-sharing awards.

U.S. District Judge Harvey Bartle III on Tuesday declined to dismiss two counts of pilot James Scanlan’s three-count suit claiming the company violated the Uniformed Services Employment and Reemployment Rights Act.

For one, the judge let stand a USERRA claim that participants in a company profit-sharing plan who took short-term military leave weren’t credited with earnings for the purpose of calculating their benefits under that plan even though workers who took other types of leave — such as for jury duty — were credited. Judge Bartle said Scanlan made a plausible claim that the company violated the law by not providing "equal rights and benefits under its profit-sharing plan to employees on short-term military leave."

Judge Bartle also wouldn't dismiss a claim that American Airlines improperly doesn't pay workers while they are out on short-term military leave even though workers on comparable other types of leave get paid. The judge said part of USERRA requires that those on military leave get comparable benefits that a company gives to those on nonmilitary leave, and that at this point American Airlines has conceded that short-term military leave and leave for other things — such as jury duty and sickness — are comparable.

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The judge did, however, agree to dismiss one claim alleging that American didn't treat short-term military leave as time spent in service of an employer for the purpose of calculating benefits under the plan, which Scanlan said was a pension plan. The judge said the plan wasn't a deferred compensation plan, but instead essentially either a bonus or extra compensation plan.

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The proposed class is represented by Adam Garner of the Garner Firm Ltd., R. Joseph Barton and Colin M. Downes of Block & Leviton LLP, Peter Romer-Friedman and Hannah Cole-Chu of Outten & Golden LLP, Matthew Z. Crotty of Crotty & Son Law Firm PLLC, and Thomas G. Jarrard of the Law Office of Thomas G. Jarrard LLC.

The case is Scanlan v. American Airlines, case number 2:18-cv-04040, in the U.S. District Court for the District of Pennsylvania.