When bankruptcy occurs, judicial treatment of the debtor’s assets and debts starts. When a person is insolvent, they can no longer pay the debts when they fall due. Are you an employee and have you not received your salary on time? Then you need to pay special attention to securing your legal position. But how should you react in this situation, and what are you entitled to?
What can employees claim?
Employee claims are claims you, as an employee, have against your employer. If you do not receive your salary on time, contact your employer first. You should set a very short deadline of 1-2 days for your employer to pay your compensation.
When the deadline expires without your salary being paid, then you can proceed with your claim, by filing a bankruptcy petition with the bankruptcy court. The bankruptcy court will then summon your employer and ask him or her some in-depth questions. If the court finds that your employer does not have the money to pay your salary, your employer will be declared bankrupt. After that, the company will be closed, and the responsibility for the further process will be handed over to a trustee. No one else will then have access to the company.
What should you pay special attention to in your new situation?
First and foremost, you should expect to be fired or released, which means you will not get your salary. However, if you are a union member, the union can offer to temporarily cover your salary.
If you are not a union member or if the union does not offer to cover your salary, you can file a claim with The Employees’ Guarantee Fund (Lønmodtagernes Garantifond in Danish or LG). You must calculate and document your estimated salary receivable in the claim, including holiday pay, pension contributions, etc.
However, it is essential that you file your claim with the bankruptcy estate already in connection with the bankruptcy! Here you must calculate and document your total salary receivable.
If you then receive your salary through the Employees’ Guarantee Fund, you should withdraw your claim with the bankruptcy estate in writing, as you may not obtain double coverage.
What does it cost as an employee to file for your employer’s bankruptcy?
You must pay a court fee of DKK 750.00 when filing the petition. If you want to read more about the court fee and what it costs to file a case you can read more here ((https://advokatgruppen.dk/erhverv/retssager-voldgift/).
Are you not an employee but a creditor who wishes to file a bankruptcy petition? Then you must provide security for the cost of the estate’s treatment of the case of DKK 30,000.00 in addition to the court fee.
Once the trustee has processed the bankruptcy, and the values in the estate have been sold, the money in the estate must be distributed among the creditors in the bankruptcy estate. It is determined by law how the distribution of the funds will take place. Your claim will, in principle, be given priority according to section 95 of the Danish Bankruptcy Act. Your claim includes the amounts to cover salary and other remuneration for work for up to 6 months prior to the date of the bankruptcy.
Furthermore, your claim includes any due compensation for a termination or dismissal within a period of up to 6 months prior to the deadline (which is the date on which the bankruptcy court receives the bankruptcy petition). Also included is your claim for holiday allowance and pension. This preference is retained only if you pursue your claim for payment and thus do not fail to prosecute your claim promptly.
Let our lawyers advise you
We have a team of lawyers who have extensive experience in advising employees. Therefore, we at Advokatgruppen can advise you on your legal position in connection with your employee claim as well as filing for bankruptcy. In addition, we have extensive experience as trustees in bankruptcy estates. We are also a member of Danish Insolvency Lawyers. So do not hesitate to contact us for a no-obligation talk!