Your Employer's Bankruptcy Does Not Have To Be The End Of The World When It Comes To Your (Hard Earned) Wage Claim!

It's true! There is some protection for your wage claims under the right circumstances. While certain administrative expenses of the bankruptcy case must be paid first by the employer "debtor," employee wage claims -- for unpaid wages or other forms of compensation such as commissions, vacation and sick leave pay—may be entitled to the highest priority treatment in most cases under the Bankruptcy Code - up to an amount not to exceed $11,725 (currently). As with most things, it's all in the details. For example, the Bankruptcy Code requires that the wages being claimed by the employee were earned within the earlier of: 180 days before the employer filed its bankruptcy petition; or, by the date the employer stopped doing business.

So, happily, there may a solution for the employee who is owed his or her hard-earned wages by an employer who filed for bankruptcy!

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