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UPI Asks Bankruptcy Court To Alter Contract

July 21, 1985

WASHINGTON (AP) _ United Press International asked a federal bankruptcy judge Saturday to terminate its contract with the Wire Service Guild, the news service reported.

UPI said in court papers it must impose $1.5 million in wage and benefit cuts in order to attract a buyer, according to a UPI story made available to The Associated Press.

UPI, which is operating under Chapter 11 bankruptcy protection, said it decided to go to court because the Wire Service Guild declined to agree to the concessions. The Guild represents about 750 UPI employees.

Guild President William Morrissey has said UPI has failed to demonstrate a need for the contract changes, as required under the federal bankruptcy code, and that the guild would resist the request.

Telephone calls to Morrissey’s home were not answered Saturday.

UPI Chairman Luis Nogales has said if the judge abrogated the contract, all terms would be honored except the concessions the company requested.

UPI spokesman David Wickenden said Thursday the company would seek to modify parts of the contract and obtain wage and benefit reductions, without abrogating the entire agreement.

Telephone calls to Wickenden’s home and office were not answered Saturday.

Under the bankruptcy code, the judge has 14 to 21 days to hold a hearing on the motion, and another 30 days to rule.

Union employees took a voluntary 25 percent pay cut last year, which has been restored in phases to a level 5 percent below the wage standard in effect in April 1984.

UPI has said it is asking those employees to accept 92.5 percent of that April salary level until Dec. 1, when it would rise to 95 percent. The 100 percent level would be restored next April 1, when the existing contract expires.

Last week, UPI requested a 90-day extension on the period it has to file a plan of reorganization, which had been due Aug. 28. If the judge approves, the new due date would be Nov. 28.

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