Judge rules in favor of laid-off FreightCar America workers

JOHNSTOWN, Pa. -- FreightCar America must offer pension benefits to laid-off workers at its Johnstown plant, a federal judge ruled.

U.S. District Judge Kim Gibson on Friday granted a preliminary injunction against the Chicago-based railcar manufacturer in response to a lawsuit filed last year by the employees backed by the United Steelworkers Union. The lawsuit accused the company of illegally laying off workers to avoid paying them pension benefits.

Gibson said the employees likely could succeed in the lawsuit.

Under the current contract, which expires May 15, the steelworkers at FreightCar America's plant near Johnstown qualify for their regular pension after five years of service and for special pension benefits after 20 years. More than 100 workers were laid off as they neared those employment benchmarks.

Employees nearing 20 years of service and those nearing their fifth year must be immediately reinstated to full-time status so they could receive pension benefits, Gibson ruled.

Local union president Dennis Conahan praised the decision but said he didn't know if the ruling means that work will be shipped back to the Johnstown plant.

FreightCar America argued it moved the work from Johnstown because of higher labor costs at the plant. The company said in court that moving one work order alone saved it $1.4 million.

FreightCar America announced in December it could not reach a new contract deal with the Johnstown workers and will close the plant. The company's Johnstown administrative offices are not included in the closure.

A message left for a FreightCar America spokesman on Saturday was not immediately returned.

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