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11 U.S.C. § 1113 — Rejection of collective bargaining agreements

Federal law — U.S. Code and appendices · legal_authorities

11 U.S.C. § 1113 — Rejection of collective bargaining agreements

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Stable record: federal_law:legal_authorities:record_usc_a269a9bf0a7f93aee657077c
Source file: Laws/federal/codes/united-states-code/title-11/section-1113-rejection-of-collective-bargaining-agreements--90063c246e.md
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Source location: Title 11, Chapter 11, § 1113; chapter-011-reorganization.md

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**(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.

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Federal law — U.S. Code and appendices · legal_authorities

45 U.S.C. § 151 — Definitions; short title

When used in this chapter and for the purposes of this chapter—

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Federal law — U.S. Code and appendices · legal_authorities

11 U.S.C. § 101 — Definitions

In this title the following definitions shall apply: (1) The term “accountant” means accountant authorized under applicable law to practice public accounting, and includes professional accounting association, corporation, or partnership, if so authorized. (2) The term “affiliate” means— (A) entity that directly or indirectly owns, controls, or holds with power to vote, 20 percent or more of the outstanding voting securities of the debtor, other than an entity that holds such securities— (i) in a fiduciary or agency capacity without sole discretionary power to vote such securities; or (ii) solely to secure a debt, if such entity has not in fact exercised such power to vote; (B) corporation 20 percent or more of whose outstanding voting securities are directly or indirectly owned, controlled, or held with power to vote, by the debtor, or by an entity that directly or indirectly owns, controls, or holds with power to vote, 20 percent or more of the outstanding voting securities of the debtor, other than an entity that holds such securities— (i) in a fiduciary or agency capacity without sole discretionary power to vote such securities; or (ii) solely to secure a debt, if such entity has not in fact exercised such power to vote; (C) person whose business is operated under a lease or operating agreement by a debtor, or person substantially all of whose property is operated under an operating agreement with the debtor; or (D) entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement. (3) The term “assisted person” means any person whose debts consist primarily of consumer debts and the value of whose nonexempt property is less than $150,000.11 See Adjustment of Dollar Amounts not

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Federal law — U.S. Code and appendices · legal_authorities

11 U.S.C. § 1113 — Rejection of collective bargaining agree-

Page 251 TITLE 11—BANKRUPTCY § 1113 (1) read as follows: ‘‘Except as provided in paragraph (2) of this subsection, subsection (c) of this section, and section 1104(a)(3), on request of a party in interest, and after notice and a hearing, absent unusual cir- cumstances specifically identified by the court that es- tablish that the requested conversion or dismissal is not in the best interests of creditors and the estate, the court shall convert a case under this chapter to a case under chapter 7 or dismiss a case under this chapter, whichever is in the best interests of creditors and the estate, if the movant establishes cause.’’ Subsec. (b)(2). Pub. L. 111–327, § 2(a)(33)(A)(ii)(I), in- serted introductory provisions and struck out former introductory provisions which read as follows: ‘‘The re- lief provided in paragraph (1) shall not be granted ab- sent unusual circumstances specifically identified by the court that establish that such relief is not in the best interests of creditors and the estate, if the debtor or another party in interest objects and establishes that—’’. Subsec. (b)(2)(B). Pub. L. 111–327, § 2(a)(33)(A)(ii)(II), substituted ‘‘converting or dismissing the case’’ for ‘‘granting such relief’’. Subsec. (e). Pub. L. 111–327, § 2(a)(33)(B), substituted ‘‘521(a)’’ for ‘‘521’’. 2005—Subsec. (b). Pub. L. 109–8 added subsec. (b) and struck out former subsec. (b) which consisted of intro- ductory provisions and pars. (1) to (10) relating to con- version of cases under this chapter to chapter 7 cases or dismissal for cause in the best interest of creditors and the estate. 1994—Subsec. (b). Pub. L. 103–394 inserted ‘‘or bank- ruptcy administrator’’ after ‘‘United States trustee’’. 1986—Subsec. (b). Pub. L. 99–554, § 224(1)(A), inserted ‘

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