Legal Question in Bankruptcy in New Jersey

Re: Suing for wages

The filing of bankruptcy creates what is known as a "bankrupt estate." In Chapter 7 (liquidation), the property of the estate is managed by the trustee who is charged with maintaining the estate and disposing of or distributing the property of the estate in order to pay the debts. The trustee can not only reach the current property of the estate, but he can also reclaim certain payments that were made during the 90 day period prior to the filing.

Debts are paid according to a priority depending on the kind of debt. Wages are high on this priority list. So, the probability that you will be paid is much higher than for example a supplier.

Pursue your wage claim against the corporation. My recommendation is that you also ensure that the New Jersey Department of Labor is also aware of the claim (Dept. of Labor, Div. of Wage and Hour Compliance: 609-292-2337). The State also considers the payment of wages to be of high priority and can help you with collecting your claim. In particular, the State can be of help in assuring that the assets of the company are not disipated before the wage claims are paid.