Hawker Beechcraft Bankruptcy Update

In a message to IAM members employed at Hawker Beechcraft in Wichita, KS, representatives of District 70 and Local 733 provided an update on developments since the company filed for Chapter 11 bankruptcy protection on May 3.

“We understand that in bankruptcy there can be periods where there is very little information, and then other times where we have to move very quickly,” said the bulletin to members. “The IAM has considerable experience defending our members’ interests in bankruptcy restructurings. We intend to employ that experience and exercise every resource available to produce the best possible outcome for our members at Hawker Beechcraft.”

On June 30, Hawker Beechcraft filed a preliminary Joint Plan for Reorganization with the bankruptcy court. The restructuring plan, which is subject to considerable modification, competing proposals and approval of the bankruptcy judge, is part of Hawker’s effort to guide the restructuring process and maintain control of the company if and when it emerges from bankruptcy.

While Hawker’s preliminary joint plan was silent on modifications to the IAM collective bargaining agreement at Hawker Beechcraft, it is not uncommon for such proposals, which would be subject to negotiation, to be made in subsequent submissions to the court.

“In Chapter 11 bankruptcy there are a lot of moving parts and there are still a lot of unknowns,” said the bulletin. “What we have told you in the past remains true:  The collective bargaining agreement is in full force and effect and all employees in the bargaining unit remain represented by the IAM.  A company in Chapter 11 bankruptcy cannot void labor agreements or make any major business decisions without the approval of a bankruptcy Judge.”

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