(a) In conformity with applicable state and federal law, the board of directors of an authority may adopt a method of selection and promotion of its employees in accordance with which it shall select and promote its employees and the board of directors of an authority shall make rules to carry out such purpose and shall investigate the enforcement and effect of such rules. The board of directors of an authority may also establish insurance, health care, retirement and other employee benefits as it deems necessary and convenient to the effective administration of the authority and may enter into contracts with any municipality, including without limitation a constituent municipality, the state, the federal government and private entities, to provide or facilitate the provision of such benefits.

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(b) An authority shall be a municipality for purposes of part II of chapter 113 and shall have all rights accorded to municipalities thereby and be subject to all provisions, requirements and limitations pertaining to municipalities contained therein. Without a referendum, an authority may accept said part II of chapter 113 by resolution adopted by its board of directors and such authority shall be deemed a participating municipality for purposes of said part II of chapter 113.

(c) Whenever an authority acquires the property and franchises of any public or private entity operating a wastewater system within its jurisdiction, all employees of such entity that such authority deems necessary for the operation of the authority may become employees of the authority and may be credited by the authority with all rights that have accrued as of the date of such acquisition with respect to seniority, sick leave, vacation, insurance and pensions benefits in accordance with the records, personnel policies or labor agreements of the acquired entity or entities and may accept all funding for such liability to the date of such credit.

(d) Such authority may assume and observe all accrued pension obligations of such acquired entity or entities and may accept all funding for such liability to the date of such assumption. Members and beneficiaries of any pension, retirement or other employee benefit system established by the acquired entity or entities may continue to have such rights, privileges, benefits, obligations and status with respect to such established systems as have accrued as of the date of such acquisition. The authority may enter into agreements with representatives of its employees relative to the inclusion of its employees in any applicable retirement plan or plans, and the authority may constitute a municipality eligible to participate in such retirement plans.

(e) The relations between an authority and its employees with respect to collective bargaining and the arbitration of labor disputes, if any, shall be governed by sections 7-467 to 7-477, inclusive.