Bankruptcy judge throws out Checker Motors' request to eliminate labor pact, attorney says

[Omaha Steve]

http://www.mlive.com/business/west-michigan/index.ssf/2009/03/judge_throws_out_checker_motor.html

by Alex Nixon | Kalamazoo Gazette
Tuesday March 03, 2009, 11:53 AM

KALAMAZOO, MI -- The judge in Checker Motors Corp.'s bankruptcy case has thrown out the company's request to throw out its labor agreement, the attorney representing the company's union said.

The auto supplier, and one-time producer of Checker taxi cabs, filed for Chapter 11 bankruptcy protection in January. In February, it asked the U.S. Bankruptcy Court for Western Michigan to reject its contract with 125 union workers and eliminate health care and pension benefits for 176 union retirees.

On Friday, bankruptcy Judge James D. Gregg agreed with attorneys for the union, United Steelworkers Union Local 2-682, that the company had not treated all parties involved in the proceeding fairly when it awarded four top executives a total of $275,000 in retention bonuses prior to filing for bankruptcy, said David Jury, attorney for the steelworkers.

"We were pleased with the results," Jury said. "While we made a serious effort to negotiate, we also expressed to the company and to the court that there's a notion in bankruptcy called 'shared sacrifice' and we felt it was unfair and inequitable to ask employees to take massive wage reductions while four top executives received large bonuses on the eve of filing."

A message seeking comment from executives with Checker Motors was not immediately returned.

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