Teamsters Local 2000 Sues Northwest Airlines
Local Demands Compliance With Employee Stock Agreement
WASHINGTON, June 3 /PRNewswire/ -- Teamsters Local 2000, in conjunction
with the International Brotherhood of Teamsters, filed a lawsuit today against
Northwest Airlines that would force the company to abide by a 1993 agreement
and reimburse Flight Attendants for sacrifices they made to save the airline
from bankruptcy.
The lawsuit was filed in a New York state court and specifically seeks a
declaration and an order requiring Northwest Airlines to honor an employee
stock agreement and repurchase shares distributed to Flight Attendants in
exchange for three years of wage and benefit concessions.
"Our members lived up to their end of the bargain and we expect no less
from Northwest Airlines," said Mollie Reiley, Local 2000 Trustee, as the
lawsuit was being filed.
In 1993, Northwest Airlines sought wage and benefit concessions from the
Flight Attendants and other labor groups. In exchange, the airline
distributed shares to the Flight Attendants in direct proportion to the wages
and benefits that they would have received. Over the course of three years,
Flight Attendants and other employees made financial sacrifices that saved the
airline approximately $900 million.
Now, the airline's Board of Directors is claiming they have the right to
breach the agreement and refuse payment to these hardworking men and women for
their sacrifices.
According to the complaint filed by the Teamsters, "[t]his lawsuit is
instituted to prevent (Northwest Airlines) from destroying the value of the
Preferred Shares and the related repurchase obligation and converting the
Flight Attendants' sweat equity into unpaid slave labor."
The complaint also says Northwest's "effort to renege on its repurchase
obligations to the Flight Attendants is particularly egregious as (the
airline) has continued to employ duplicitous financial manipulations to avoid
paying its employees what they are owed."
Flight Attendants were given a "put" right with respect to any shares of
the Preferred Stock they still hold. A "put" is an option permitting its
holder to sell stock at a fixed price. Northwest has publicly acknowledged
that it is obligated to repurchase the Flight Attendants' Preferred Shares for
cash; but, at the same time the Board of Directors has made a spurious claim
that it has the right to cause the Company not to do so.
Founded in 1903, the International Brotherhood of Teamsters represents
nearly 50,000 hard working men and women in the airline industry and more than
1.4 million workers throughout the United States and Canada. Teamsters Local
2000 represents over 11,000 Northwest Airlines and Sun Country Flight
Attendants.
Roger
EWROPS