Legal Question in Bankruptcy in New York

Re: Uninsured Employer-Workers Cmpensation Dischargeable?

This is a trick question. If the corporation is declaring bankruptcy, it will do so under a re-organization or re-payment plan. All of the debts will be 're-organized'. If there is no 'plan', then the corporation will be dissolved and the shareholders will take nothing anyway.

If an individual is declaring bankruptcy, then the workers comp claim is likely corporate and not a personal debt. It is not chargeable to the person.

To answer the question, under most circumstances it is not dischargeable. It is more than a derivative 'wage claim', it is a statutorily required restitution to the uninsured workers fund. (you will pay the required premiums, but not the claim directly).

There are circumstances in which it would be excused under the bankruptcy laws, but I would need to know more about your business to indicate how they would apply to you.

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