Democrats in the U.S. House are seeking to protect local-government workers in bankruptcy proceedings, responding to the record collapse in Detroit that’s poised to reduce city workers’ retirement benefits, Bloomberg News reported yesterday. A bill by Michigan Representative John Conyers, the top Democrat on the House Judiciary Committee, and three other fellow Democrats would strengthen the threshold for negotiations with workers before a filing could be approved. It would also require employees to consent to changes to contracts, including pension and health-care benefits. Detroit filed for court protection almost a year ago after decades of population decline left it unable to pay its debts. The filing led to a court fight between workers and retirees over the city’s diminished resources. Conyers said that the legislation is intended to make it tougher for localities to use bankruptcy proceedings to get out of union agreements. Two Senate Democrats — West Virginia’s Jay Rockefeller and Elizabeth Warren of Massachusetts — have also introduced legislation making it more difficult to cut retiree benefits in bankruptcy.
