An employee of a bankrupt company could be able to receive up to $11,725 in unpaid wages and up to $11,725 in contributions to employee benefit plans,for a total of $23,450 before any money is paid to a consumer to compensate for deposits paid to the company for goods which were never delivered because of the company's going bankrupt.

Question

Quizplus · Accepted Answer

This is true according to the Bankruptcy Code's priority order for distributing funds from a bankrupt company. Unpaid wages and employee benefit plan contributions are given priority over repayments to consumers for undelivered goods.

An Employee of a Bankrupt Company Could Be Able to Receive