Chapter 11
6274086
25 Posts
I am looking for some guidance....as always....we are most likely filing chapter 11 and I need to start researching several things. First, the best way to comminucate to the staff regarding the situation, second, where do I look for guidance regarding a plan administrators responsibility for the benefit plans and 401k plan. Any direction would help, thanks!
Comments
First, my most sincere wishes that your organization can pull out of this, restructure, or make it through in some other way. Though I have not been through this as a professional, I did find some materials that might be of help to you . . . you might want to take a look at:
http://www.dol.gov/ebsa/publications/joblosstoolkit.html good DOL information
http://www.atlantisplastics.com/Chapter11-Employees.pdf it touches on some common employee questions and answers you may want to consider
http://www.adam-friedman.com/afa/chapter.htm some commuication tips
http://www.flightglobal.com/blogs/runway-girl/2008/06/geminis-letter-to-employees-ex.html a sample letter to employees
Generally, retirement assets should not be at risk if your employer declares bankruptcy . Federal law requires that retirement plans fund promised benefits adequately and keep plan assets separate from the employer’s business assets. The funds must be held in trust or invested in an insurance contract. The employers’ creditors cannot make a claim on retirement plan funds. Significant business events such as bankruptcies, mergers, and acquisitions can result in employers abandoning their individual account plans. Custodians such as banks, insurers, and mutual fund companies are left holding the assets of these plans but do not have the authority to terminate the plans and distribute the assets. In response, the Department of Labor issued rules to create a voluntary process for the custodian to wind up the plan’s business so that benefit distributions can be made and the plan terminated. Information about this program can be found on the Department’s Web site at www.dol.gov/ebsa.
[quote user="6274086"]I am looking for some guidance....as always....we are most likely filing chapter 11 and I need to start researching several things. First, the best way to comminucate to the staff regarding the situation, second, where do I look for guidance regarding a plan administrators responsibility for the benefit plans and 401k plan. Any direction would help, thanks![/quote]
The easiest way to communicate with employees is to tell them the truth. They do not need to know all the facts, but they do need to know the truth.
"Despite a valiant effort by everyone in the Company, and the sacrifices we have all made, <the economy, loss of customers, whatever> has forced Acme Corporation to file for Chapter 11 Bankruptcy. Chapter 11 is not the bitter end: it is an opportunity to obtain some relief so that we can pull out of this situation and, eventually, go back to normal operations and continue to grow our organization. The Chapter 11 process works as follows... Here's what you can expect... The 800 Pount Gorilla in the room is layoffs. We foresee being able to avoid layoffs by obtaining Chapter 11 protection."