Company is insolvent - what to do?

02-14  Source: Network gathering  Views:22 

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Company is insolvent - what to do?

The bankruptcy law is also a labor protection law.

Is the company insolvent, the entrepreneur must act

Corporations are required to register within three weeks insolvency if they find their insolvency or overindebtedness. Partnerships and sole entrepreneurs are not insolvency request prescription. As a result, however, does not change.

  • The bankruptcy procedure is in two stages. If the contractor or a creditor application for insolvency, the insolvency court determines first a provisional administrator. Regularly the entrepreneur loses control over his company. Task of the temporary administrator is to ensure to the final opening of insolvency proceedings the company's assets and to obtain. It checks whether a process cost-covering assets exist.
  • Depending on, the insolvency court the application for insolvency from or opened in the next stage the insolvency proceedings. Simultaneously with the opening of a bankruptcy receiver is appointed.

What does the liquidator?

Even in the period of the preliminary insolvency proceedings all pay and employment duties and notice periods shall continue. Only with the actual insolvency may shorten longer notice periods to three months. Shorter periods are continuing, however. A legal special protection against dismissal for pregnant and SHEs or council members persists.

  • A reason for termination "insolvency" does not exist. Typically, the liquidator but Pronounce redundancies. This justified by the fact that the order situation is bad or the company can only be continued with a reduced workforce.
  • Despite an agreed contract period, the liquidator may, after the opening of proceedings neatly with a notice period of three months to the end of the month six months (§ 113 InsO). He must observe the dismissal protection rules. In particular, it depends on the social criteria. The special right of termination also covers fixed-term contracts.
  • With mass layoffs termination is effective only with the express agreement of the Federal Employment Agency. The company is obligated to report the dismissal of a large number of workers of the Employment Agency in advance. The obligation is linked to specific operating variables and the number of workers concerned. To mitigate the economic disadvantages the company can create a social plan (§ 123 InsO). The claims therefrom are "insolvency assets". They are mainly to be met before other creditors.
  • In the insolvency proceedings of the council is to participate prior to termination. He can make certain in § 102 WCA rights. The central element is the equitable social selection in the workforce.

The shield method opens up new perspectives

Your employment relationship shall continue with the opening of insolvency proceedings. They remain to work obligation, even if the company is insolvent. Their fate as workers depends on how entrepreneurs and insolvency evaluate the company's perspective.

  • The entrepreneur can file for bankruptcy itself. He will then do this regularly when he sees a perspective in the restructuring of the company. He must submit to the bankruptcy court of an insolvency plan, the rehabilitation can succeed. He has three months to rehabilitate the company. The court shall provide the business a provisional administrator to the side, which advises the entrepreneurs and supervised.
  • The law speaks of "self-administration" and granted the contractor the "protection proceedings". The entrepreneur can continue under the protective umbrella of the insolvency proceedings his company in its own responsibility. Opposite enforcement of creditors is granted enforcement protection.

What can you do as an employee and claim

  • Pay before bankruptcy declaration: You are entitled to insolvency benefit (formerly insolvency compensation) if you do not have claims for unpaid wages in bankruptcy proceedings for the last three months before the opening of proceedings. Insolvency money you receive in the event of insolvency dismissal for lack of assets.
  • You must submit the application to the employment agency. Because you can make from the insolvency application retroactively only finance provisional liquidator disbursement often through a bank before. Given contact from your wage claims to the bank. In return, the bank pays your salary and receive the money later from the employment agency as insolvency money back.
  • The insolvency benefit equal to the net remuneration. Fused are merely claims on wages that are not older than three months. Older claims are treated as simple insolvency claims without priority over other creditors.
  • Wage from insolvency: Your pension rights from initiating the procedure shall continue to apply. Will the liquidator reduce your salary, he must speak in compliance with the in § 113 InsO certain periods of notice a change notice. Their claims represent mass liabilities. This means that such claims against the claims of other creditors in advance and thus a priority basis are.
  • Holidays: persist your holiday entitlement. The same applies to compensation claims for unclaimed vacation days. Can the liquidator not pay your compensation claim, it is to make as an unsecured bankruptcy claim asserted. You can apply for your vacation as usual. As long as no operational reason is, you can take the vacation.
  • Arbeitszeugnis: You are entitled to a job reference. Your contact person is the liquidator who will delegate the task regularly to the person who can you judge best.

The bankruptcy declaration is for all concerned a significant burden of financial and mental nature. It is in the nature of things, that each party is trying to make the best out of it. Since an insolvency procedure is a very complex issue with many options and perspectives, you should seek legal advice if in doubt. Only so you can be sure that your rights are fully respected.

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