Laid off but company closes

[hammy]

What is the name of your state (only U.S. law)? NY

What happens if my employer has laid me off with a retention bonus and severance package but, while still employed, the bank takes over the company and freezes all assets forcing the company to close down completely? Does the employer or the bank still have to honor the separation agreement and payment terms as well as payout the rest of the agreed upon salary and vacation time?

 

[Zigner]

What is the name of your state (only U.S. law)? NY

What happens if my employer has laid me off with a retention bonus and severance package but, while still employed, the bank takes over the company and freezes all assets forcing the company to close down completely? Does the employer or the bank still have to honor the separation agreement and payment terms as well as payout the rest of the agreed upon salary and vacation time?

How can the company honor the separation agreement when their assets were taken over pursuant to a prior lien?

 

[LdiJ]

How can the company honor the separation agreement when their assets were taken over pursuant to a prior lien?

I realize that is a very valid point but I am pretty sure that there are rules in place that govern that sort of thing. Even perfected liens are subordinate to certain items in a bankruptcy.

I think that this one is probably over our heads and that the OP should consult a local employment attorney and perhaps a bankruptcy attorney as well to get some insight.

 

[Zigner]

I realize that is a very valid point but I am pretty sure that there are rules in place that govern that sort of thing. Even perfected liens are subordinate to certain items in a bankruptcy.

I think that this one is probably over our heads and that the OP should consult a local employment attorney and perhaps a bankruptcy attorney as well to get some insight.

What bankruptcy? OP didn't mention anything about that

 

[LdiJ]

What bankruptcy? OP didn't mention anything about that

If the bank has frozen the company assets a bankruptcy is coming.

 

[commentator]

Check with the wage and hour division of your state department of labor. They should be able to tell you what will be likely to happen.