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MARTIN v. AMR SERVS. CORP.

February 22, 1995

WILLIAM MARTIN, JOE VELEZ, JOSE GONZALEZ, RUSSELL CARPINO, and GEORGE JOHNSON, individually and on behalf of all other persons similarly situated, Plaintiffs, against AMR SERVICES CORPORATION, a subsidiary of AMR CORPORATION, Defendants.


The opinion of the court was delivered by: JACK B. WEINSTEIN

 Weinstein, J.:

 Plaintiffs charge that defendant AMR Services Corp. ("AMR") failed to comply with the notice requirements of the Worker Adjustment and Retraining Notification Act ("WARN"), 29 U.S.C. § 2101 et seq., when it closed its Security Department at New York's John F. Kennedy Airport in the Spring of 1993. All relevant evidence has been produced by discovery or adequate affidavits and concessions in argument or in briefs.

 AMR moves for summary judgment, contending that since fewer than 50 employees suffered an "employment loss" as defined by WARN, that statute's notice requirement were not triggered and therefore no statutory violation occurred. Plaintiffs also seek summary judgment. At issue is whether AMR's actions with respect to 18 employees placed in other jobs at AMR shortly after they were told their department had been eliminated suffered an employment loss as defined by WARN. Since these employees did not lose their employment, AMR's motion for summary judgment is granted and plaintiffs' cross motion is denied.

 I. FACTS

 AMR is an aviation ground services company whose operations include freight distribution and servicing, baggage handling, aircraft parts distribution, and other services for the airline industry. In May 1993, AMR decided to close its Security Department at JFK Airport and contract-out these functions. At the time, AMR employed 91 people in the security unit, one salaried manager and 90 hourly workers.

 The parties agree that AMR is an employer as defined under WARN, 29 U.S.C. § 2101(a), and is subject to its provisions. In addition to the rights that employees may have under WARN, AMR employees have additional rights under AMR's internal employment regulations, specifically AMR's "Reduction in Force/Recall" manual ("RIF Regulations").

 Under the RIF Regulations, "employees may be declared surplus as a result for [sic] a need for reduction in force in a specific work unit." A subsection of the RIF Regulations entitled "Reduction in Force Policy" provides seniority-qualified worker protections common in industry. It states:

 
a. The senior most qualified employees (i.e. individual ability to adapt to new position, prior job performance/attendance, performance evaluation, etc.) may displace a probationary employee in the same job classification in a similar work unit at the station.
 
b. The senior most qualified employee may fill existing vacancies in the same or other job classifications in the system.
 
General Manager or Regional Personnel Manager for the station affected by a reduction in force will contract Director Personnel, HDQ, to obtain complete list of vacancies in the system.
 
Qualified employees will be interviewed for position(s). It is management's discretion to offer or not offer the position.
 
Employee's pay would be rated on the last day worked in position from which surplused, or minimum rate of the new position, whichever is greater. If rate at time of surplus is greater than new rate, market rates will govern.
 
If either option a or b is not available to surplused employees he/she will be subsequently laid-off from the company.

 RIF Regulations 1-2.

 Another subsection, entitled "Recall," provides for employment of laid off workers. It reads:

 
Surplused employees who have completed probation prior to, or on the last day worked, will be placed on the recall roster. . . .
 
An employee retains recall rights to position(s) from which surplused for two years from the last day worked in that position. . . .
 
Recalled employees will be paid their former rate held when surplused, or the minimum for the position to which recalled, whichever is greater. . . .
 
Employees will not accrue seniority while on layoff. Upon recall or reemployment during active recall period, seniority accrued before layoff will be credited to the employee.

 RIF Regulations 3.

 AMR sent letters dated May 21, 1993 to each of the 90 hourly workers stating that they had been "declared surplus" due to the Security Department's elimination. The letters provided that the employees' final day of work would be May 31, 1993, but that they would be paid through Friday, June 4, 1993. A similar letter dated May 3, 1993 advised the department manager that his last day was May 3, 1993 and that he would be paid through May 17, 1993. The letters noted that those employees who were members of the AMR Services Corp. Group Life and Health Benefits Plan "may elect to convert [their] coverage to an individual policy," and that "solicitation for conversion [would] be sent under separate cover." Solicitations for conversion were subsequently provided to the 11 employees who were eligible members of the health plan. There is some disagreement between the parties regarding the status and disposition of a number of the employees. AMR contends that the 90 hourly employees should be classified as follows:

 
1) 19 part-time employees who worked an average of fewer than 20 hours per week in the 90 days preceding the date on which notice under WARN would have been due.
 
2) 7 part-time employees who worked fewer than 6 of the 12 months preceding the date on which WARN notice would have been due.
 
3) 18 employees who were immediately placed in other AMR jobs at JFK airport, pursuant to AMR's RIF Regulations, ...

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