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Successorship Clauses In Collective Bargaining Agreements

Question: Our union wants to include a succession clause in our union contract, so that if we ever sell the company, the buyer will have to take over our collective agreement. Should we be worried? Wouldn`t the union contract be the buyers` problem and not ours? Answer: These types of succession clauses are a frequent union demand, and if you accept one, you should be prepared to take them seriously if you ever decide to sell your business. A recent lawsuit shows that the union and the courts will take the clause seriously and force you to abide by it. In this case, the employer had accepted a clause stating that any sale or transfer of the business would be subject to the buyer`s approval of the seller`s collective agreement. The company`s parent company began a restructuring that eliminated the company and merged its operations and employees into the parent company. During the completion of the restructuring, the company made no effort to obtain the agreement of its parent company to complete the replacement clause. The union filed a lawsuit and the court asked the company to comply with the succession clause on the grounds that it had to comply because it had negotiated and accepted the clause (Equitable Resources, Inc. v. United Steel, 6th Cir, Sept.

2010). Do you need help responding to union demands? Talk to your vigilante. Come up with a theme and we could discuss it in a future blog post…


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