Wabtec agrees to pay $37M in no-poach class action

Source: Pittsburgh Post-Gazette

WILMERDING, Penn. – Wabtec Corp. has agreed to pay $37 million to settle a class-action case stemming from a yearslong no-poach agreement between the North Shore-based rail products firm and its foremost competitor.

If approved by the court, the settlement would end years of litigation and award, on average, $5,830 to more than 8,000 people who worked at Wabtec, its competitor Knorr-Bremse AG and Faivelely Transport, before that company was acquired by Wabtec in late 2016.

It was during a review of that acquisition that the U.S. Department of Justice discovered the arrangements between the three rail parts companies. Justice officials said that since 2009, the companies had been conspiring to restrict competition, limit job opportunities, and depress wages through agreements not to pursue or hire each-others’ employees without prior approval.

As part of the DOJ settlement in April 2018, federal law enforcement officials required the companies to stop these anti-competitive practices and agreed not pursue fines or any other legal actions against them. But shortly after the agreement was made public, a number of lawsuits were filed by employees of the firms seeking damages.

Those cases were consolidated into the current case in the U.S. District Court for the Western District of Pennsylvania.

German manufacturer Knorr-Bremse was the first to reach a settlement with the plaintiffs in August 2019. It agreed to pay $12 million and, crucially for the workers, Knorr said it would cooperate in the case.

“The Knorr settlement was the ‘icebreaker’ that helped to induce Wabtec to settle,” the plaintiffs wrote in a memorandum chronicling the settlement process.

Wabtec, in a statement, said it was “pleased to have reached a settlement” and noted that it’s still “subject to court approval, which will likely happen in 2020.”

The plaintiffs were clearly pleased as well.

“The settlements are excellent,” they wrote in the memo filed with the court earlier this week.

They estimate there are 8,396 people that are part of the settlement class. Of those, 6,126 worked for Wabtec.

Wabtec has 27,000 employees in more than 80 countries, but the settlement class is limited to those “who worked in job families in which railway industry experience or skills were valuable” during the years when the no-poach agreements were in place.

Excerpted from a story in the Pittsburgh Post-Gazette. The entire piece can be read by clicking on this sentence.

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