In February 2016, the Supreme Court set aside a
lower-court decision that had overturned the conversion of a branch
of an industrial union into an independent enterprise union.
See Case No. 2012Da96120 (Sup. Ct. Feb.
A branch (the "Valeo Electric Systems Branch") of the
Metal Workers' Union, an industrial union, had converted itself
into an enterprise union (the "Valeo Electric Systems
Union") through a resolution of its general meeting. The Metal
Workers' Union had filed a lawsuit seeking a declaration that
the resolution was invalid, because withdrawal from the Metal
Workers' Union by means of a general meeting is not permitted
by the union's rules.
Prior precedents have recognized that a labor union is allowed
to change its form based on a general meeting's resolution if
it is itself an enterprise union; or if it is a branch or chapter
of an industrial/regional/occupational labor union with the ability
to independently undertake collective bargaining or enter into a
collective bargaining agreement in connection with matters specific
to its organization or members. In addition, it should have its own
regulatory and enforcement body, and act as an independent
Based on those precedents, the initial trial and appeal both
ruled in favor of the Metal Workers' Union, declaring that the
union's rules did not allow the Valeo Electric Systems Branch
to engage in independent decision-making contrary to the intent of
the Metal Workers' Union. The Valeo Electric Systems Branch was
not an independent union, as wage negotiations and collective
bargaining were carried out at the level of the Metal Workers'
However, the Supreme Court decided to expand the established
principles governing the change of a union's form, holding
that, "If a subgroup of an industrial union or a branch of an
industrial union satisfies one of the following conditions, it may
change its form to an enterprise union: The industrial union's
subgroup or branch (1) has the ability, similar to an enterprise
union, to independently undertake collective bargaining or enter
into a collective bargaining agreement; or (2) operates essentially
like an unincorporated workers' association that has its own
regulatory and enforcement body, and acts as an independent group,
even though it may not have the ability to undertake collective
bargaining or enter into a collective bargaining
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Sticking to what you know in new employment may backfire when client-specific restraints protect an employer's interest.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).