GST Roach Calls for Bankruptcy Law Reform
March 26, 2013
Quick links+
IAM General Secretary-Treasurer Robert Roach, Jr., testifies in Washington, DC, on behalf of IAM members at the American Bankruptcy Institute (ABI) Commission to Study the Reform of Chapter 11.
When it comes to corporate bankruptcy filings, sacrifices must be shared – equally – from top to bottom, said IAM General Secretary-Treasurer Robert Roach, Jr., before the American Bankruptcy Institute (ABI) Commission to Study the Reform of Chapter 11, in Washington, DC.
“If employees are called upon to sacrifice in order to resurrect their bankrupt employer, bankruptcy law must require that everyone from the break room to the board room shares the pain,” said GST Roach in his testimony. “While Chapter 11 bankruptcy can provide struggling companies an opportunity to re-group and avoid liquidation, it is increasingly abused as a means to get a leg-up on the competition by placing an undue burden on employees and retirees. Companies are increasingly using bankruptcy as a means to take what they can from employees outside of the normal collective bargaining process, not just what is needed for a corporation to survive.”
The Commission, composed of leading bankruptcy professionals, was created in 2012 to explore and recommend much-needed changes to the United States’ 35-year-old bankruptcy code. Labor and employee benefits were the focus of the panel’s most recent hearing where members of both labor and management were asked to testify about the way the current bankruptcy code treats collective bargaining agreements, pensions, etc.
GST Roach spoke about IAM members, as well as his own personal experience, working for a company filing for bankruptcy.
“I first want to give you a real face of an employee coming out of bankruptcy,” said Roach. “I worked at TWA for 36 years. My retirement will be $326 a month. That’s a sad commentary for the richest country in the world. Now, I’m lucky to have a position within the union, but there are tens of thousands of people who have gone through bankruptcy in this country who no longer have pensions, who no longer have health care, who no longer know how to protect themselves and the elements they thought would be protected by working for a corporation for a long time. United Airlines, US Airways, Northwest Airlines, Hostess, Kaiser Aluminum, the list goes on and on. It should not happen that the same corporations and carriers walk away with tens of millions of dollars.”
Roach reminded the Commission that the IAM was the only labor organization in the country to secure defined-benefit plans for its members during the United Airlines bankruptcy.
“We were fortunate that we had a $9 billion pension fund, the IAM National Pension Fund,” said the GST. “But other employees didn’t have that option. We had to fight in bankruptcy to get that done. The IAM strongly supports comprehensive bankruptcy reform that will protect our nation’s workers and require shared sacrifice among all stakeholders.”
The Commission is expected to issue its final recommendations in April 2014.
Video of Roach’s testimony can be seen here. A copy of his written testimony is available here.
