11 ms·
Maybe you can answer this for me, since I've always wondered: what happens if your company runs out of money, and you get into an impossible situation where you
by gyardley 14y ago
Maybe you can answer this for me, since I've always wondered: what happens if your company runs out of money, and you get into an impossible situation where you can't keep paying your employees, but you also can't afford to pay the severance required by law to lay them off?
Does the government throw you in jail? Does it come out of your own pocket? (And what if you personally can't afford it?) Does the company just end up owing everyone a bunch of money it can't pay anyway?
- vpeters25 14y agoI don't really know much about the penalties involved in chilean labor laws. I know there is a labor inspection bureau where you can report "bad employers" and have them fined. Fired employees usually report their former employers to it as revenge since the inspectors always find violations. One think I see happen a lot is companies rather stay on business barely surviving than close their doors, because is so expensive to layoff employees. I haven't been back to Chile in 10 years so things might have changed for the better.
- jpablo 14y agoI don't know about Chile, but in Mexico with similar laws the company will go to something similar to chapter 11. And this money owned to employees will the considered as part of the company debts (however it'll be the higher priority debt). As a debt it can be negotiated (with unions) or if the company is liquidated it'll be pay (in full or part) out of any money that can be extracted from the company assets.