Dems Offer Another Senate bill Seeking to Aid Employees
Sharon Edmondson, Washington Legislative Team Member | May 13, 2015
On April 30, Sen. Durbin (D-Ill) and several co-sponsors introduced a bill aimed at “improving protections for employees and retirees in business bankruptcies.” The “Protecting Employees and Retirees in Business Bankruptcies Act” (S 1156) was referred to the Senate Judiciary Committee. A companion bill was introduced January 6 in the House by House Judiciary Committee Ranking member John Conyers (D-MI).
The bill would improve protections for employees by:
- increasing the amount of worker claims entitled to priority payment for unpaid wages and contributions to employee benefit plans up to $20,000;
- eliminating the difficult-to-prove restriction in current law that wage and benefit claims must be earned within 180 days of the bankruptcy filing in order to be entitled to priority payment;
- allowing employees to assert claims for losses in certain defined contribution plans when such losses result from employer fraud or breach of fiduciary duty;
- establishing a new priority administrative expense for workers’ severance pay;
- clarifying that back pay awards for WARN Act damages are entitled to the same priority as back pay for other legal violations;
- restricting the conditions under which collective bargaining agreements and commitments to fund retiree pensions and health benefits may be eliminated or adversely affected;
- preventing companies from singling out non-management retirees for concessions;
- requiring a court to consider the impact a bidder's offer to purchase a company's assets would have on maintaining existing jobs and preserving retiree pension and health benefits;
- clarifying that the principal purpose of Chapter 11 bankruptcy is the preservation of jobs to the maximum extent possible;
- requiring full disclosure and court approval of executive compensation packages;
- restricting the payment of bonuses and other forms of incentive compensation to senior officers and others; and
- ensuring that insiders cannot receive retiree benefits if workers have lost their retirement or health benefits.
Click here to view the bill.