Rights of employees of companies filing chapter 7

The company my sister worked for filed chapter 7 on Friday the 26th. They were told on Monday they would not get paid for days worked after Friday the 26th, would get no severance, vacation pay or commissions owed. This is in NYC. What are their rights? Do they have any?

Asked on June 30, 2009 under Employment Labor Law, New Jersey


B. B., Member, New Jersey Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

The vacation pay may be history, but earned wages should be a prior claim over anything other than taxes;  commissions owed might depend on the specific facts.  The New York wage and hour agency should be willing to take this on for your sister and the other employees.

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