Westinghouse Accord May Be EEOC’s Biggest : 4,000 Workers in Pension Case to Share $35 Million

The Equal Employment Opportunity Commission said Thursday that it reached what appears to be its largest cash settlement in an employment discrimination case, a $35-million deal with Westinghouse Electric Corp.

EEOC negotiators were armed with a U.S. District Court ruling that Westinghouse violated the Age Discrimination in Employment Act when it denied severance pay to employees who were eligible for pensions when their jobs were eliminated in plant closings.

“We broke some new ground,” said EEOC general counsel Charles Shanor. “The district court held . . . that forcing a pension-eligible employee to choose between the pension and severance is unlawful.”

Westinghouse estimates that 4,000 former workers should share the $35 million, an estimate that EEOC will check.

EEOC sued Westinghouse in New Jersey and in Pennsylvania in the early 1980s. The Pennsylvania suit was expanded in 1984 to include all Westinghouse employees nationwide, except those represented in the New Jersey suit.

Will Put Funds in Escrow

A federal judge in New Jersey dismissed one suit, and EEOC appealed to the U.S. 3rd Circuit Court of Appeals in Philadelphia. A federal judge in Philadelphia ruled in the agency’s favor, and Westinghouse appealed that decision to the 3rd Circuit.

The tentative settlement covers both cases, Shanor said.

“I presume that if Westinghouse thought they were a lead pipe winner, they won’t have put $35 million up, and likewise, because this is a settlement . . . each side has to engage in some give and take,” he said.

Westinghouse said it agreed to deposit the money in escrow for distribution after various conditions are met.

The 3rd Circuit Court must agree to suspend ruling on the case until a U.S. District Court in Philadelphia rules on the fairness of the settlement.