Compliance January 8, 2002

Durban-Delahunt Bill to Bolster Retirees Payment Chances

August 1, 2002 (PLANSPONSOR.com) - In light of the stream of corporate debacles winding up in bankruptcy court, two US lawmakers want to give workers a better shot at collecting benefit promises.

Reported by

Fred Schneyer

According to a Reuters news report, Senator Richard Durbin (D-Illinois) and Representative William Delahunt (D-Massachusetts) said they would introduce a bill to enhance a bankruptcy judge’s handling of employee benefit claims among the crowd of other creditors.

The new measure would be designed to keep workers from getting pushed to the back of the bankruptcy creditors’ line where the likelihood of repayment is iffy at best.

The Durbin-Delahunt bill will also beef up the authority of a bankruptcy judge and a bankruptcy trustee to delve into and legally challenge any recent actions that have drained off corporate assets. Those pre-bankruptcy transfers would also be restricted under the legislation, according to Reuters.

Congress began considering steps to improve corporate accountability following the bankruptcies of energy-trader Enron Corp., telecommunications firm WorldCom Group Inc. and others. Employees, retirees and investors lost millions in those collapses.