Sixth Circuit: Union Can Challenge RIF and Non-Recall of Employees Except Where Employees Signed Release

Last week, the Sixth Circuit Court of Appeals reversed a summary judgment in favor of an employer against a union which challenged the layoff and non-recall of five union employees during a reduction in force.  International Union, UAW v. General Motors LLC, No. 12-2327 (6^th Cir. 7-10-13). The plaintiffs had been laid off out of order of seniority purportedly because they were not capable of performing work being performed after a reorganization.  They were not recalled to work in inverse order of seniority for the same reason.  The Court found that the union raised a material issue of fact about whether the employees were qualified to perform work that was being performed in the factory after the reorganization and by less senior employees who were recalled to work.   However, because two of the employees had signed a release in connection with their separation which waived their right to challenge their termination and any right to future employment, their individual claims were barred.

The union introduced four pieces of evidence which contradicted the employer’s position that the employees were incapable of performing work that remained in the factory.  First, it was undisputed that the employees were competent and performed their former jobs acceptably prior to the reorganization.   Second, the union proffered an affidavit by a line-employee stating that work previously performed by the five employees was still being performed, other than that all employees had to learn a new computer program.   The Court found the district court erred in excluding his testimony on the grounds that he was not a “supervisor” and was unqualified to explain whether any jobs consisted solely of novice-level work.  Third, the employer had recalled novice-level employees with less seniority. While the union might have been incorrect, that was an issue of credibility.  Finally, the union disputed the employer’s characterization of the employees’ qualifications since they were rated higher than the employer now claimed.  While the union might have been utilizing outdated information, that argument again went to credibility and weight instead of materiality.

Two of the five employees received severance pay in exchange for signing a release of claims that contained, in part, language that barred all:

 “claims, grievances, lawsuits, demands and causes of action, whether known or unknown . . . in any way relating to [the] employment and/or separations from General Motors Corporation . . .  .  “I understand that GM does not intend for me to be eligible at any time in the future for reemployment by GM . . . .”

The Court rejected the argument that the releases could not waive post-termination claims because the employees were aware of their recall rights at the time they signed the release and were aware that they were signing away their right to future employment.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.