• LinkedIn
  • YouTube
  • Twitter
  • Facebook
  • Google+

Leave contracts to the experts: Have attorney draft documents detailing benefits

by on
in Employee Benefits Program,Employment Law

Make sure an attorney reviews any contracts dealing with employee benefits and the like. A good lawyer will make sure the agreement does what you want it to do and doesn’t have language that may need court interpretation.

Recent case: Bunge Oils agreed to supplement union employee wages with regular contributions to a union health and welfare fund. The agreement said that Bunge would “make contributions to the trust at the rates charged by the trust” subject to a maximum specified elsewhere in the contract. Those rates climbed every year.

Bunge continued paying a rate less than the maximum. When the agreement expired, the union sued, alleging Bunge should have contributed at the higher rate.

But Bunge successfully argued that the union never “charged” it the higher rate.

The court agreed with Bunge—the higher amounts were only due if the union billed at that rate. It had not. (South Central UCF Unions v. Bunge Oil, No. 3:09-CV-1924, ND TX, 2011)

Final note: Basic contract law says that words should be interpreted to have their ordinary meaning. “Charge” means “to bill.” Thus, unless the union billed for the higher amount, Bunge was only required to pay the lower amount it had paid in previous years.

Having your attorney review contractual language helps catch problems like this. It’s especially important if your company writes up the agreement—because any ambiguities will be interpreted against you and in favor of the other side.

Like what you've read? ...Republish it and share great business tips!

Attention: Readers, Publishers, Editors, Bloggers, Media, Webmasters and more...

We believe great content should be read and passed around. After all, knowledge IS power. And good business can become great with the right information at their fingertips. If you'd like to share any of the insightful articles on BusinessManagementDaily.com, you may republish or syndicate it without charge.

The only thing we ask is that you keep the article exactly as it was written and formatted. You also need to include an attribution statement and link to the article.

" This information is proudly provided by Business Management Daily.com: http://www.businessmanagementdaily.com/14618/leave-contracts-to-the-experts-have-attorney-draft-documents-detailing-benefits "

Leave a Comment