Letter to The Honorable Elaine L. Chao, Secretary of Labor

Letter

By:  Dick Durbin Barack Obama II
Date: April 4, 2008
Location: Washington, DC

After ATA Firings, Durbin and Obama Seek Assistance for Employees

Tribune reports of last minute notification prompt requests for information

WASHINGTON, DC - U.S. Senators Dick Durbin and Barack Obama today sent a letter to the Secretary of Labor, Elaine Chao, requesting assistance for workers who lost their jobs after yesterday's decision by ATA to shut down its operation. After the Chicago Tribune reported last minute notification calls to employees, Durbin and Obama raised questions as to the manner in which these calls were made and the responsibility that ATA has to its workers going forward.

"It would be inexcusable for executives at ATA to enjoy generous payment and bonus packages, while workers are left without their retirement savings and healthcare," the Illinois members wrote. "Clearly, the sudden shutdown of ATA this week is an indication of the challenges within the airline industry today. These realities, however, are not an excuse for firing workers without notice or for leaving workers without the protection of earnings, benefits and retirement savings they already have earned."

On April 3, ATA Airlines stranded passengers around the country and at Chicago's Midway airport when it discontinued all flights and filed for bankruptcy. More than 2,200 will be affected by this decision. ATA employed approximately 300 workers in the Chicagoland region.

April 4, 2008

The Honorable Elaine L. Chao
U.S. Department of Labor
Frances Perkins Building
200 Constitution Avenue, NW
Washington, DC 20210

Dear Secretary Chao:

We request your assistance in determining the rights, benefits and protections available to the workers laid off due to the abrupt termination of operations and bankruptcy filing of ATA Airlines. We would also ask that you address the responsibilities ATA Airlines had to its workers in notifying them that bankruptcy and service disruptions were imminent.

Although there were press reports about ATA's financial struggles, the airline's sudden shutdown was a shock to the company's more than 2,200 employees. The Chicago Tribune reported that an employee at Midway Airport received a 3 a.m. phone call notifying her not to show up for work that morning. Losing one's job is a life-altering event. Workers need some reasonable notice of such an event.

The Worker Adjustment and Retraining Notification (WARN) Act requires employers to provide a 60-day notice in advance of a business closure or mass layoff. Was ATA Airlines in compliance with the WARN Act? What compensation may be available to workers if it is found they were not given sufficient notification?

ATA's sudden firing raises serious questions about the future of the workers' health coverage and retirement savings. Who is monitoring the company 401(k) plan? What steps are being taken to protect the employees' assets in the 401(k) plans? Has ATA been making regular contributions to their workers' 401(k) plan? Under COBRA, what obligations does the company have to the recently fired workers?

It would be inexcusable for executives at ATA to enjoy generous payment and bonus packages, while workers are left without their retirement savings and healthcare. What information can you provide on the terms of ATA leadership compensation?

Clearly, the sudden shutdown of ATA this week is an indication of the challenges within the airline industry today. These realities, however, are not an excuse for firing workers without notice or for leaving workers without the protection of earnings, benefits and retirement savings they already have earned.

Thank you for attention to this important matter. We look forward to hearing from you promptly.

Sincerely,

Richard J. Durbin
U.S. Senator

Barack Obama
U.S. Senator