Author: Andrew M. Thaler
I am often asked if bankruptcy can discharge an employer’s obligation to pay wages to an employee. The answer is – it depends. The bankruptcy code sets forth a list of certain debts that an individual cannot discharge. Drafters of the Bankruptcy Code decided that it would be against public policy to discharge certain debts (i) owed to financially vulnerable persons; (ii) owed to governmental entities; or (ii) that arise out of a debtor’s bad behavior. If a debt falls into one of those categories, there is a high likelihood that the debt may not be discharged in a chapter 7 bankruptcy.
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