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The Labor and Employment Committee has continued to remain at the forefront of the intersection of labor and employment issues and bankruptcy in its continuing effort to keep its members well-informed as they navigate these issues. To begin, this year our Committee paired up with ABI’s Asset Sales Committee for the Annual Spring Meeting to discuss “Labor Issues in 363 Sales: Things You Need to Know.” The panel included Lucian B.

The Third Circuit recently became the first U.S. Court of Appeals to rule that a pension plan established by a church agency does not qualify as an exempt “church plan” under subsection 4(b)(2) of the Employment Retirement Income Security Act (ERISA).

This year has seen many significant developments affecting the intersection of labor and employment issues and bankruptcy. The Labor and Employment Committee endeavors to remain at the forefront of this highly specialized and complex subset of bankruptcy laws in an effort to keep its members well-informed as they navigate these issues.

An unsecured creditors’ committee is supposed to be representative of the interests of a diverse group of unsecured creditors with an interest in the outcome of a debtor’s reorganization or “fresh start.” Landlords with lease-rejection claims, parties to rejected equipment leases, trade creditors, unsecured bondholders and the Pension Benefit Guaranty Corporation are a few examples.

Section 365 of the Bankruptcy Code authorizes a debtor to assume or reject an executory contract.[1] An executory contract that has expired in accordance with its terms is generally not subject to assumption or rejection under the Code. However, a collective-bargaining agreement (CBA) presents a unique exception to that general rule because upon expiration of the CBA, employers are required to maintain the status quo while the employer and the union negotiates the terms of a new CBA under the National Labor Relations Act (NLRA).

Recently, the U.S. Bankruptcy Court for the District of Delaware had the opportunity to further clarify the power of § 363 sale processes to cleanse assets and the fragile nature of pension claims in bankruptcy. The court considered and rejected an objection to a § 363 sale free and clear of any successor liability claim where the sale was supported by the debtors, the lenders and the unsecured creditors’ committee, but not the pension trust.

Once disfavored, non-compete agreements — contractual provisions prohibiting employees from competing with their former employers upon the relationship’s termination — have acquired new legitimacy in recent decades.

Editor’s Note: This article is intended for educational purposes only. It is not intended to be legal, accounting or other professional advice. A party should consult with legal counsel when dealing with the issues addressed in this article. The views expressed in this article are solely those of the author and do not necessarily represent the views or opinions of Husch Blackwell LLP.