11 U.S.C. § 1113 : US Code - Section 1113: Rejection of collective bargaining agreements

Search 11 U.S.C. § 1113 : US Code - Section 1113: Rejection of collective bargaining agreements

(a) The debtor in possession, or the trustee if one has been
appointed under the provisions of this chapter, other than a
trustee in a case covered by subchapter IV of this chapter and by
title I of the Railway Labor Act, may assume or reject a collective
bargaining agreement only in accordance with the provisions of this
section.
(b)(1) Subsequent to filing a petition and prior to filing an
application seeking rejection of a collective bargaining agreement,
the debtor in possession or trustee (hereinafter in this section
"trustee" shall include a debtor in possession), shall -
(A) make a proposal to the authorized representative of the
employees covered by such agreement, based on the most complete
and reliable information available at the time of such proposal,
which provides for those necessary modifications in the employees
benefits and protections that are necessary to permit the
reorganization of the debtor and assures that all creditors, the
debtor and all of the affected parties are treated fairly and
equitably; and
(B) provide, subject to subsection (d)(3), the representative
of the employees with such relevant information as is necessary
to evaluate the proposal.
(2) During the period beginning on the date of the making of a
proposal provided for in paragraph (1) and ending on the date of
the hearing provided for in subsection (d)(1), the trustee shall
meet, at reasonable times, with the authorized representative to
confer in good faith in attempting to reach mutually satisfactory
modifications of such agreement.
(c) The court shall approve an application for rejection of a
collective bargaining agreement only if the court finds that -
(1) the trustee has, prior to the hearing, made a proposal that
fulfills the requirements of subsection (b)(1);
(2) the authorized representative of the employees has refused
to accept such proposal without good cause; and
(3) the balance of the equities clearly favors rejection of
such agreement.
(d)(1) Upon the filing of an application for rejection the court
shall schedule a hearing to be held not later than fourteen days
after the date of the filing of such application. All interested
parties may appear and be heard at such hearing. Adequate notice
shall be provided to such parties at least ten days before the date
of such hearing. The court may extend the time for the commencement
of such hearing for a period not exceeding seven days where the
circumstances of the case, and the interests of justice require
such extension, or for additional periods of time to which the
trustee and representative agree.
(2) The court shall rule on such application for rejection within
thirty days after the date of the commencement of the hearing. In
the interests of justice, the court may extend such time for ruling
for such additional period as the trustee and the employees'
representative may agree to. If the court does not rule on such
application within thirty days after the date of the commencement
of the hearing, or within such additional time as the trustee and
the employees' representative may agree to, the trustee may
terminate or alter any provisions of the collective bargaining
agreement pending the ruling of the court on such application.
(3) The court may enter such protective orders, consistent with
the need of the authorized representative of the employee to
evaluate the trustee's proposal and the application for rejection,
as may be necessary to prevent disclosure of information provided
to such representative where such disclosure could compromise the
position of the debtor with respect to its competitors in the
industry in which it is engaged.
(e) If during a period when the collective bargaining agreement
continues in effect, and if essential to the continuation of the
debtor's business, or in order to avoid irreparable damage to the
estate, the court, after notice and a hearing, may authorize the
trustee to implement interim changes in the terms, conditions,
wages, benefits, or work rules provided by a collective bargaining
agreement. Any hearing under this paragraph shall be scheduled in
accordance with the needs of the trustee. The implementation of
such interim changes shall not render the application for rejection
moot.
(f) No provision of this title shall be construed to permit a
trustee to unilaterally terminate or alter any provisions of a
collective bargaining agreement prior to compliance with the
provisions of this section.