Can a company get out of it’s current contract with it’s union workers if it changes the company name?

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Can a company get out of it’s current contract with it’s union workers if it changes the company name?

The company announced it’s building closure 9 months ago. Negotiated a building closure contract with the union. Sold the licensing rights to it’s name 4 months ago. And announced last week that it was changing it’s name. Will they still have to honor our contracts if it’s under the company’s old name, which they no longer own?

Asked on January 8, 2012 under Employment Labor Law, Ohio

Answers:

MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

The issue here is whether by doing so the company just breached a perfectly viable and enforceable contract. If so, the state labor department may have a say and the union can possibly sue the company and file a motion to force the new company to be a party to the contract. The company may have to pay restitution or some form of equity damages for this possible blatant attempt to undermine the union agreement. You should speak to your union steward or the headquarters for the union and see if this something the union is going to pursue.


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