As has probably been mentioned before, the NMB's own flowchart dictates the proffer of binding arbitration when the two sides cannot reach an agreement, a fact established well before bk, and if one or the other refuses the 30 day clock begins. 2/3rds of the membership had faith in a system that's as dysfunctional as the compAAny we work for.
APA,APFA & TWU
- Thread starter aapitbull
- Start date
- Aug 20, 2002
- 7,319
- 1,555
Is this where the discussion concerning the RLA and the Bankruptcy Court picksvup again. Which has presidencies?
I don't think that one law must necessarily trump the other, despite numerous posts asserting that one does or does not or that one law must trump the other.
Debtors are permitted to reject just about every executory contract, and labor agreements are an executory contract. After the early airline bankruptcies where the airlines and the corporate raiders rejected the labor agreements, Congress enacted Section 1113 to make it tougher to reject a labor agreement, but as history has shown, it's a rather toothless provision, as it's still possible to abrogate labor agreements when the debtor and the workgroups cannot reach agreement (as long as all the provisions of 1113 are met).
In contract abrogation, the judge must reconcile the provisions of the RLA with the bankruptcy code. In the NW AFA case, the judge ruled that abrogation was not unilateral action and that the FAs could not engage in self-help as a result of the abrogation. The court of appeals held that abrogation did not permit the affected workgroup to take self-help.
eolesen
Veteran
- Jul 23, 2003
- 15,959
- 9,374
The provisions require the company attempting to negotiate in good faith, and proving that the modifications are necessary for the successful restructuring of the estate.
It won't take much to show that having a lowered cost structure commensurate or lower than its peers will improve the likelihood of the company surviving.
We can probably argue for years about what negotiating in good faith constitutes, but in the end, the judge gets to decide if there was a reasonable attempt by the company to find a consensual solution.
My opinion is that the company may appear to some to only be going thru the motions, since their position hasn't changed much from when contract openers started, but they only have to engage in discussions.
There's no requirement for the union to do anything, but I don't see where they're doing themselves any favors by choosing to look for legal loopholes, instead of trying to find some common ground.
The more games they play, the more likely I see it being for the judge to pencil whip the box that says "good faith discussions were attempted but unsuccessful".
I can't recall a case where a bankruptcy abrogation was appealed, and while an extreme outcome, it wouldn't surprise me to see it happen here given some of the other attempts in this proceeding...
But that will also cost the unions more money, and my guess is that the unions have already resigned themselves to the fact that the term sheets really are the best they can hope for. By stonewalling, they know they can avoid being held accountable to the same degree the union leaders in 2003 were, which meant being replaced for the APA and APFA leadership, but driving the union into bankruptcy would also leave them open to being replaced...
It won't take much to show that having a lowered cost structure commensurate or lower than its peers will improve the likelihood of the company surviving.
We can probably argue for years about what negotiating in good faith constitutes, but in the end, the judge gets to decide if there was a reasonable attempt by the company to find a consensual solution.
My opinion is that the company may appear to some to only be going thru the motions, since their position hasn't changed much from when contract openers started, but they only have to engage in discussions.
There's no requirement for the union to do anything, but I don't see where they're doing themselves any favors by choosing to look for legal loopholes, instead of trying to find some common ground.
The more games they play, the more likely I see it being for the judge to pencil whip the box that says "good faith discussions were attempted but unsuccessful".
I can't recall a case where a bankruptcy abrogation was appealed, and while an extreme outcome, it wouldn't surprise me to see it happen here given some of the other attempts in this proceeding...
But that will also cost the unions more money, and my guess is that the unions have already resigned themselves to the fact that the term sheets really are the best they can hope for. By stonewalling, they know they can avoid being held accountable to the same degree the union leaders in 2003 were, which meant being replaced for the APA and APFA leadership, but driving the union into bankruptcy would also leave them open to being replaced...
There are 9 distinct and separate conditions to be met before the judge can permit thee debtor to abrogate.
Pursuant to section 1113(c), if the debtor and union cannot come to terms over modifications to a CBA, the debtor can move for rejection of the CBA so long as it has complied with the statutory procedures for rejection. Most courts evaluate this process in light of a nine- step test first developed in In re American Provisions:
1. The debtor must make a proposal to the union after filing the bankruptcy petition, but before making a section 1113 motion.
2. The proposal must be based on the most complete and reliable information available at the time of the proposal.
3. Modification must be necessary to permit reorganization.
4. Modification must provide that all affected parties are treated fairly and equitably.
5. The debtor must provide the union with relevant information as is necessary to evaluate the proposal.
6. The debtor must have met with the union at reasonable times subsequent to making the proposal.
7. The debtor must have negotiated in good faith concerning the proposal.
8. The union must have refused to accept the proposal without good cause.
9. The balance of the equities must clearly favor rejection of the agreement.
In re American Provisions, 44 B.R. 907 (Bankr. D. Minn. 1984)
IMHO 3,5,7 and 9 are the heaviest left for the company and the ones most subject to extreme scrutiny by all 3...APFA, TWU and APA. Hell, I ain't no lawyer nor number cruncher but I can see huge issues with #3 and #7 right off the bat.
Pursuant to section 1113(c), if the debtor and union cannot come to terms over modifications to a CBA, the debtor can move for rejection of the CBA so long as it has complied with the statutory procedures for rejection. Most courts evaluate this process in light of a nine- step test first developed in In re American Provisions:
1. The debtor must make a proposal to the union after filing the bankruptcy petition, but before making a section 1113 motion.
2. The proposal must be based on the most complete and reliable information available at the time of the proposal.
3. Modification must be necessary to permit reorganization.
4. Modification must provide that all affected parties are treated fairly and equitably.
5. The debtor must provide the union with relevant information as is necessary to evaluate the proposal.
6. The debtor must have met with the union at reasonable times subsequent to making the proposal.
7. The debtor must have negotiated in good faith concerning the proposal.
8. The union must have refused to accept the proposal without good cause.
9. The balance of the equities must clearly favor rejection of the agreement.
In re American Provisions, 44 B.R. 907 (Bankr. D. Minn. 1984)
IMHO 3,5,7 and 9 are the heaviest left for the company and the ones most subject to extreme scrutiny by all 3...APFA, TWU and APA. Hell, I ain't no lawyer nor number cruncher but I can see huge issues with #3 and #7 right off the bat.
"attempting to negotiate in good faith"
I think I'll just attempt to fix airplanes today in good faith!!! :huh: :huh:
The judge will have to make a decision. Both parties are so far apart that it would
take a miracle for a consensual agreement to be reached. In one side you have
employees that are in total denial of the situation at hand. On the other side you
have a company that did this to themselves by a whole bunch of greedy executives
that just kept lining their pockets while the company was on a nose dive.
It's obvious that ultimately the judge will have to make a decision wether to abrogate
the contracts or not. If you look at other bankruptcies in the past chances are he will
rule on the company favor.
take a miracle for a consensual agreement to be reached. In one side you have
employees that are in total denial of the situation at hand. On the other side you
have a company that did this to themselves by a whole bunch of greedy executives
that just kept lining their pockets while the company was on a nose dive.
It's obvious that ultimately the judge will have to make a decision wether to abrogate
the contracts or not. If you look at other bankruptcies in the past chances are he will
rule on the company favor.
TWU informer
Veteran
- Nov 4, 2003
- 7,550
- 3,731
And it burned, burned, burned, the ring of fire, the ring of fire.
I can't see the Company ever agreeing to this. Why would they?? They have us where they want us with the 1113 stuff.
I wish our unions wouldn't waste our money on lost causes like this. Better to use our energy and resources to negotiate the best bankruptcy deal we can get, and then move on.
I wish our unions wouldn't waste our money on lost causes like this. Better to use our energy and resources to negotiate the best bankruptcy deal we can get, and then move on.
