After 11-Year Fight, Pace Industries Pays Union Members $12 Million for Discrimination

The National Labor Relations Board recently entered into a compliance agreement with the United Auto Workers Union and Pace Industries, now doing business as Precision Industries. The agreement requires the company to pay nearly $12 million to individuals who were wrongfully denied employment and employees and former employees who were paid lower wages and denied certain fringe benefits.

According to the NLRB, the events that led to 11 years of litigation against Pace Industries, involving its plant in Malvern, Ark., began in October 1988. At that time, Pace "unlawfully refused to hire" approximately 62 former employees of Universal Die Casting to avoid bargaining with their union, the UAW.

The UAW filed an unfair labor practice charge with the NLRB office in Memphis, Tenn. Finding merit to the charge after an investigation, the Regional Director issued a complaint against Pace.

After a 13-week trial that ended in 1991, NLRB Administrative Law Judge Thomas R. Wilks issued a decision on May 4, 1993 upholding the complaint. The judge found that Pace violated Section 8(a)(3) and (5) of the National Labor Relations Act.

Following the U.S. Court of Appeals for the 8th Circuit denial of Pace's appeal and motions for rehearing, the Supreme Court denied Pace's Petition for Writ of Certiorari in 1998.

Meanwhile, the NLRB said, Pace began to comply with the NLRB order in 1997 by recognizing the UAW, bargaining with the union and offering to reinstate numerous employees. This February, the parties reached a collective-bargaining agreement.

The NLRB and Pace were unable to agree on the amount of backpay due, until eventually the parties signed the compliance agreement. Judge Carson approved the agreement on Dec. 28, 1999.

Under the settlement terms, Pace will pay $65 million in backpay for lost wages and benefits to 62 individuals. The company will also pay $3.7 million to employees and former employees for the difference between wages and benefits paid and the amount that should have been paid; and an additional $1 million to $2 million to restore the terms of the UDC pension plan.