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socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 38888
Experience:  Attorney and Real Estate Broker -- Retired (mostly)
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I have just be terminated by my employer and when initially

Resolved Question:

I have just be terminated by my employer and when initially hired (12/08) had negotiated a 6 month severance and a fixed minimum bonus for my first year. The employer filed bankruptcy (Chapter 11) in Nov 2009. They offered a severance but not at the negotiated level. Does their entry into Chapter 11 allow them to void the original severance and bonus commitments? The court has approved (5/2010) their plan for exiting bankruptcy. What are my rights for the negotiated severance and bonus?
Submitted: 7 years ago.
Category: Bankruptcy Law
Expert:  socrateaser replied 7 years ago.

Under Bankr. Code § 507(a)(4), an employee is entitled to a priority claim of up to $11,725 of unpaid wages (including salaries and commissions, vacation, severance, and sick leave pay), if earned within 180 days of the employer's filing of the bankruptcy petition.


I'd like to say that the issue had some wiggle room -- but it doesn't. The law is crystal clear.


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