THE DUTY TO BARGAIN AND REJECTION OF COLLECTIVE AGREEMENTS UNDER SECTION 1113 BY A BANKRUPT AIRLINE: TRYING TO RECONCILE R.L.A. WITH BANKRUPTCY CODE

Since 1978, when the airline industry was deregulated by Congress, a wave of bankruptcies has hit and directly, or indirectly affected virtually all air carriers. In this article, the authors attempt to reconcile the remedy of rejection of a labor agreement provided by Section 1113 of the Bankruptcy Code with the Railway Labor Act (R.L.A.). (The R.L.A. was amended in 1936 to include the airlines.) First, the applicable bankruptcy provisions are discussed. Then the right of an employer who is in a bankruptcy reorganization process to reject his collective labor agreements is examined. The third part of this article examines the difficult legal problems that the right to reject an agreement by a bankrupt company, covered by R.L.A., creates as far as the duty to bargain is concerned. The discussion distinguishes between the problems arising before the court's decision whether to reject an agreement, and those presented after the court has issued its decision. Finally, the competing interests to be balanced in a bankruptcy reorganization when collective bargaining and agreements are threatened by the needs and pressures of reorganization are discussed. Based on this balancing, it is concluded that the best approach for a court which is called to reconcile bankruptcy law and the R.L.A. will be the one that will encourage dialogue between the parties, of course, within the time limits that a bankruptcy always exercises upon both management and labor.

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  • Accession Number: 00496756
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Aug 31 1990 12:00AM