"bifurcation" scenario

[lexi]

what do you think about the following:

there is a CBA in effect that expires 12.31.2007. the CBA covers EE that were employed by a company that, subsequently, has merged with a new company.

the new company does not want to participate in the CBA, as it is currently drafted. the acquiring corp would prefer to integrate all NEW EE entering the union into an already-existing profit sharing plan, which it has been administering for several years, to minimize book-keeping headaches. so, in effect, you would have a union that has "grandfathered" EE under the old 12.31.2007 CBA and new employees hired subsequent to the corporate restructuring in a profit sharing plan.

can we "bifurcate" members of a single union? is there a famous case out there involving Central States Pension Plan?

thanks in advance for any insight you might be able to provide.

[Bill Ecklund]

The case is: 08/08/1985, U.S. Court of Appeals, 8th Circuit, CENTRAL HARDWARE COMPANY, a corporation, Appellee, v. CENTRAL STATES, SOUTHEAST AND SOUTHWEST AREAS PENSION FUND, and Loran W. Robbins, Marion M. Winstead, Harold J. Yates, Earl L. Jennings Jr., Howard . . . . ., 770 F2d 106, 6 EBC 2525, 120 BNA LRRM 3029, 103 CCH LC ¶11637, 1985-2 CCH Trade Cases ¶66739.

It says that the trustees of a pension plan can terminate an employer from a pension plan, if the employer negotiates a CBA that the trustees believe will not be actuarial sound for the plan. In the Central Hardware case the employer and union negotiated a provision that said all current employees would continue to particpate in the Central States plan while all new hires would participate in a company plan. The court upheld the ability of the trustees to reject employer contributions under this scenario.