Legal Question in Bankruptcy in Indiana

My company filed Chapter 7....

The company I work for filed Chapter 7 bankruptcy and we are being told that if the court appointed trustee who takes over operations offers to let us stay on through the wind down of business and we turn that offer down we might not be eligible for unemployment benefits in spite of the fact that we have been given future dated permanent layoff notices from the company. We've been told the trustee has no obligation to pay us until the bankruptcy is settled, if we get paid at all. Am I really not eligible for unemployment if there is no clear date or promise of payment? I feel like I'm being held hostage.


Asked on 11/05/08, 12:34 pm

1 Answer from Attorneys
C. David DuMond Law Offices of David DuMond

Re: My company filed Chapter 7....

The Thirteenth Amendment abolished involuntary servitude. A bankruptcy trustee can take over and offer you different wage terms that you once had, but the trustee must still comply with wage and hour regulations, meaning that if you work, you get paid at least bi-monthly. Otherwise, you have been constructively terminated, and you are entitled to unemployment benefits. I suggest you call the trustee for clarification about these questions. Good luck.

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Answered on 11/05/08, 2:00 pm


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