Toth v. USX Corp.

693 F. Supp. 693, 9 Employee Benefits Cas. (BNA) 2613, 130 L.R.R.M. (BNA) 3142, 1988 U.S. Dist. LEXIS 9756, 1988 WL 90591
CourtDistrict Court, N.D. Illinois
DecidedSeptember 1, 1988
Docket88 C 2135
StatusPublished
Cited by3 cases

This text of 693 F. Supp. 693 (Toth v. USX Corp.) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Toth v. USX Corp., 693 F. Supp. 693, 9 Employee Benefits Cas. (BNA) 2613, 130 L.R.R.M. (BNA) 3142, 1988 U.S. Dist. LEXIS 9756, 1988 WL 90591 (N.D. Ill. 1988).

Opinion

MEMORANDUM ORDER

BUA, District Judge.

Defendant USX Corporation (“USX”) and Defendant United Steelworkers of America, AFL-CIO-CLC (“USWA”) move this court pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure to dismiss plaintiffs’ complaint. For the reasons stated herein, USX and USWA’s motions are granted, and plaintiffs’ complaint is dismissed in its entirety.

I. FACTS

Plaintiffs are 15 USWA staff representatives who were active employees of USX prior to joining the union staff on a full-time basis. Each began his employment with USX 30 or more years ago and at various times prior to October 1977 left to become full-time USWA staff representa *695 tives. 1 Prior to February 24, 1984, USX permitted its employees to leave USX for a period of up to two years to assume full-time work with USWA without requiring the employees to incur a break in service. While on such a leave of absence, union representatives accrue pension benefit rights as if they were working for USX. At the end of the two-year period, union representatives declining to resume employment with USX suffer a break in service which adversely affects their rights under the USX pension program.

On February 24, 1984, USX changed its leave of absence policy. Under the revised policy, USX extended the leave of absence period and permitted qualifying persons to remain on such leave until they retired from either USX or USWA. Union representatives that previously worked at a current USX steel producing facility and left prior to January 1,1979 to assume full-time union positions servicing bargaining units with which they had been associated during their tenure with USX were eligible to apply. If selected to participate in the extended leave plan by USX, such union representatives would receive retroactive service credit as well as future service credit for the duration of their union employment. The plan revision makes clear that service credit attained under the extended leave program “shall be determined solely on the minimum formula” under the rules of governing the relevant pension plan.

Over a year after adopting the extended leave policy, USX forwarded USWA President Lynn Williams a letter announcing the change. Oddly, the letter, dated March 5, 1985, notes that six union representatives had already applied and were accepted under the revised program. Williams, however, failed to relay this information to plaintiffs or other eligible union representatives. As of February 1987, the only applicants or participants in the revised program were the six union officials to which reference is made in USX’s March 5, 1985 letter.

In early 1987, plaintiffs discovered for the first time that a revised leave of absence policy existed and that they might be eligible to receive pension benefits under it. Beginning in March 1987 and continuing to the time the instant case was filed, plaintiffs submitted applications to USX for participation in the new leave of absence program. All such applications, however, were denied. By letter dated April 28, 1987, USX informed Williams that the extended leave of absence program was being terminated because recent appellate decisions indicated such long-term leave of absence plans violated § 302 of the Labor Management Relations Act. Rescission of the policy, the letter explained, was simply intended to conform USX’s practice with the current status of the law. The letter indicated that although all pending applications for participation in the revised program were being denied, “leaves of absence which previously had been granted pursuant to such policy” were not being rescinded. On May 14,1987, USX formally amended its leave of absence policy abolishing the terms of the 1984 revision. The amendment was made effective April 1, 1987.

Suffering this denial, plaintiffs approached USWA officials for help in securing benefits provided under the 1984 plan. After a series of meetings, plaintiffs were informed that USWA would not represent them in their quest for additional pension benefits from USX. Plaintiffs responded by filing the instant action.

II. DISCUSSION

In Counts I-Y of their complaint, plaintiffs assert a variety of claims under the Labor Management Relations Act (“LMRA”), 29 U.S.C. § 141 et seq., and the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1001 et seq., seeking monetary and equitable relief from USX. Each of plaintiffs’ claims against USX is premised on the adoption or revocation of the extended leave program. In *696 Count VI, plaintiffs seek damages from USWA for lost pension benefits as well as costs and fees incurred in litigating the present case. Plaintiffs’ claims against the USWA are based on the theory that USWA breached its duty of fair representation by failing to promptly disclose information concerning the 1984 revisions to USX’s leave of absence program and refusing to represent plaintiffs in their efforts to secure benefits thereunder.

USX moves to dismiss Counts I-V on the ground that the revised leave of absence program upon which plaintiffs’ claims rest is unlawful under § 302 of the LMRA, 29 U.S.C. § 186. USWA moves to dismiss Count VI on the basis that it owes no duty of fair representation to individuals such as plaintiffs who left the bargaining unit for which USWA functions as an exclusive bargaining representative. Defendants’ motions will be addressed in turn.

A. USX’s Motion to Dismiss

Section 302(A) of the LMRA, 29 U.S.C. § 186(a), provides in relevant part:

It shall be unlawful for any employer ... to pay, lend, or deliver, or agree to pay, lend, or deliver, any money or other thing of value—
(1) to any representative of any of his employees who are employed in an industry affecting commerce; or
(2) to any labor organization, or any officer or employee thereof, which represents, seeks to represent, or would admit to membership, any of the employees of such employer who are employed in an industry affecting commerce.

Section 302(b) of the LMRA, 29 U.S.C. § 186(b), contains reciprocal provisions prohibiting labor organizations and their officers or employees from requesting, receiving, or agreeing to receive or “accept any payment, loan, or delivery of any money or other thing of value prohibited by subsection (a).” The prohibitions contained in §§ 302(a) and (b) are aimed at preserving the integrity of the collective bargaining process by preventing employers from tampering with the loyalty of union officials and union officials from “shaking down” employers. Arroyo v. United States,

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Related

Helmer v. Briody
747 F. Supp. 1020 (S.D. New York, 1990)
Andrew Toth v. Usx Corporation
883 F.2d 1297 (Seventh Circuit, 1989)

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693 F. Supp. 693, 9 Employee Benefits Cas. (BNA) 2613, 130 L.R.R.M. (BNA) 3142, 1988 U.S. Dist. LEXIS 9756, 1988 WL 90591, Counsel Stack Legal Research, https://law.counselstack.com/opinion/toth-v-usx-corp-ilnd-1988.