When placing a business in liquidation, salary employee becomes one of the major concerns. Indeed, it is true that a company experiencing significant financial difficulties may also encounter problems with the payment of the salaries of its employees. However, guarantees exist and employees benefit from specific protections which make them creditors not like the others.
Judicial liquidation: will salaries be paid?
Unlike the company's other creditors, employees are not required to report their claims. Indeed, the employees of the company benefit from a privilege: that of being paid in priority.
Thus, during judicial liquidation, the agent must carry out assets and clear liabilities. In fact, he must sell the assets and carry out the clearance of the liabilities, that is to say settle all the debts and pay all the debts of the company; for this a strict order must be respected, but it is the employees who must be paid first. When company funds are sufficient, salaries are paid up to a monthly ceiling equal to double the monthly ceiling for social security contributions.
Wage Guarantee Insurance
You should know that all employees benefit from the wage payment guarantee. So what happens when the company no longer has the means necessary to pay the salaries and allowances owed to its employees? In this case it is the wage guarantee scheme that comes into play. It is known above all under the acronym AGS. This protection is subject to compulsory employer contribution.
As soon as a reorganization procedure or judicial liquidation, wages are covered by AGS. This guarantee insurance also covers commissions, premiums and indemnities due to employees. It can also pay for termination indemnities in the event of breaches of contract notified before the date of opening of the procedure. These remunerations are guaranteed for the last sixty days of work.
Even if the employees are fully compensated, the law sets ceilings:
- If you signed an employment contract six months before the opening of the judicial liquidation procedure, the maximum compensation is € 49,376.
- Between six months and two years before, it is € 61,720.
- If your hiring is longer than two years before going into liquidation, the compensation ceiling is € 75,064.
With regard to the remuneration due after the opening of a judicial liquidation, lower ceilings apply. They depend on the time spent in the company from that moment on. These ceilings are € 6,172 for someone who has worked for a month and € 9,258 for someone who has worked for a month and a half.
During the procedure of liquidation, employees have to appoint a representative who will be in charge of controlling the amounts due and paid. It is he who will act as the intermediary between the court, the administrator and the employees.
In addition, if the employees dispute the sums paid by the organization, they are entitled to appeal to the industrial tribunal.
Company in compulsory liquidation: what are the payment terms?
These deadlines are very variable but we can give an approximation. Late wages are therefore settled between 4 and 5 weeks from the date of judicial liquidation; for notice and paid holidays, it is necessary to wait between 8 and 10 weeks.
Employees who did not wish to join the CSP will have their severance pay paid at the end of the last month of notice. As for those who have joined, they will be paid at the same time of the possible notice and paid vacation.
