The United States Court of Appeals for the Fifth Circuit held that an employee pension plan falls within the scope of the Railway Labor Act (“RLA”) and is subject to its mandatory arbitration procedures.
In Ballew v. Cont’l Airlines, Inc., No. 11-20279, (5th Cir. Jan. 31, 2012) plaintiffs are former Continental Airlines pilots (“Retirees”) who filed a class action against Continental Airlines under ERISA § 502(a)(1)(B), alleging Continental breached the terms of Retirees’ pension plan. The district court dismissed Retirees’ claims for lack of jurisdiction, holding that the RLA applied to Retirees and that the RLA gives exclusive jurisdiction over their contract interpretation claim to the administrative resolution process. Retirees appealed.
The issues presented to the Fifth Circuit are:
- Whether the RLA applies to Retirees as “employees.” The court concluded that the RLA applied despite the claimants’ status as retirees. The court supported its decision by citing Pennsylvania Railroad Co. v. Day, 360 U.S. 548, 79 S. Ct. 1322, 3 L. Ed. 2d 1422 (1959), “[[a]ll the considerations of legislative meaning and policy which have compelled the conclusion that an active employee must submit his claims to the Board, and may not resort to the courts in the first instance, are the same when the employee has retired and seeks compensation for work performed while he remained on active service.”
- Whether, despite the RLA’s exclusive arbitration procedures, Retirees may seek judicial review of adverse Retirement Board determinations. The court explained that parties to a Collective Bargaining Agreement (“CBA”) could either provide for RLA dispute resolution or could exclude certain disputes from the RLA’s mandates and provide for judicial review under ERISA, but could not provide for systems board review under the RLA followed by judicial review under ERISA.
Accordingly, the Fifth Circuit affirmed the district court’s judgment.