The former owners of the old Continental Can Co. have agreed to pay more than $400 million to approximately 3,000 laid-off factory workers who were illegally denied pensions, sources close to the dispute confirmed yesterday.
Local United Steelworkers union officials said they think that about 300 Baltimore-area residents will be eligible for the lump-sum payments, some of which which might exceed $100,000.
The sources, who said they were constrained by a court order, said the details of the settlement of a class-action suit filed by the Steelworkers against Peter Kiewit Sons Inc. of Omaha, Neb., will be revealed today at a news conference in Washington.
The settlement will resolve a case in which a federal judge determined that the can-maker illegally laid off workers to prevent them from becoming eligible for pensions.
U.S. District Judge H. Lee Sarokin of New Jersey found last year that Continental Can had a computer program that ordered a plant shut down any time a significant number of its workers were about to become eligible for pensions.
Papers released by Continental during the New Jersey trial showed that the company, starting in the late 1970s and running through the mid-1980s, had intentionally laid off employees just before they became vested in the pension plan.
In 1984, Continental Can was bought by Kiewit, a privately held construction and packaging concern. Late last year, Kiewit sold the canning operations to Philadelphia-based Crown Cork & Seal Co. Inc., but Kiewit remained responsible for the lawsuit.
David Wilson, director of the Maryland-area district of the Steelworkers union, said that two decades ago as many as 1,000 Marylanders worked in the state's four Continental Can plants. Today, the three remaining Maryland plants, now owned by Crown Cork & Seal, have about 140 hourly workers.
Messages to Kiewit's in-house attorney and one of the Chicago attorneys who represented the company in the case were not returned.
According to reports published after Kiewit was found liable last year, Kiewit's attorneys conceded that some employees should be compensated but fought claims that nearly 3,000 were eligible for payments.
They argued that the can business was weak in the 1960s and 1970s because soft drink and beer bottlers switched from steel cans to aluminum. They said most of the employees would have been laid off even without the computer program.