Legal Question in Bankruptcy in Maryland

Creditors--and unpaid employees are considered creditors once their employer files for bankruptcy--have a priority claim against the employer for unpaid wages and vacation time. The claim is for "wages, salaries or commissions, including vacation, severance, and sick leave pay earned by an individual..." 11 USC � 597(a)(4). The priority portion of the claim is limited to $11,725 and covers monies earned within 180 days before the case was filed or the employer closed its doors, whichever occurred first.

This does not necessarily mean that the employees will be paid. It does mean that they will get paid ahead of certain other claims.

It may make sense for the employees to band together to hire a bankruptcy attorney to make sure that their interests are protected. If I can help, please let me know.