If the company that I work for, a restaurant is filing Chapter 11, will they have to close the restaurant and will I lose my job? 24 Answers as of April 09, 2014

Ask a Local Attorney. 100% Anonymous. Free Answers.

Free Case Evaluation by a Local Lawyer: Click here
EDWARD P RUSSELL | EDWARD P RUSSELL
I do not get involved with Chapter 11 bankruptcies but I believe that a Ch. 11 is for the opportunity for the business to continue in operation while paying its creditors less money.
Answer Applies to: Minnesota
Replied: 4/9/2014
Stephens Gourley & Bywater | David A. Stephens
If they file chapter 11 they are usually trying to rehabilitate rather than shut down the business.
Answer Applies to: Nevada
Replied: 4/8/2014
Idaho Bankruptcy Law | Paul Ross
In many cases, a Chapter 11 allows a business to reorganize their debts. The purpose is usually to avoid closing and laying off all employees. That is not likely the case. However, there is the occasional Chapter 11 where the plan is to liquidate, but it is much more rare than the reorganization Chapter 11.
Answer Applies to: Idaho
Replied: 4/8/2014
Law Offices of Linda Rose Fessler | Linda Fessler
Not necessarily.
Answer Applies to: California
Replied: 4/8/2014
Lynch Law Offices, P.C. | Roseanne N. Lynch
You will not necessarily lose your job and you can file a claim for your wages through the Court if any are owed to you. The Chapter 11 is a Reorganization of the business, most of the time it means that the business will continue to run under a Plan. When you receive the Bankruptcy papers you should see an attorney who can advise you on filing a claim.
Answer Applies to: Illinois
Replied: 4/7/2014
    Moore Taylor Law Firm, P.A.
    Moore Taylor Law Firm, P.A. | Jane Downey
    A chapter 11 means they want to operate and usually they seek court permission to continue paying employees.
    Answer Applies to: South Carolina
    Replied: 4/7/2014
    Ronald K. Nims LLC | Ronald K. Nims
    Not necessarily, Chapter 11 means that the company is trying to continue operating. Chapter 7 would mean that they are shutting down and going out of business. Of course, often companies in Chapter 11 close unprofitable parts of their business - so it's possible that your restaurant might close.
    Answer Applies to: Ohio
    Replied: 4/7/2014
    Garner Law Office
    Garner Law Office | Daniel Garner
    A chapter 11 typically involves a rescheduling of debt rather than a complete liquidation, so it does not necessarily mean that they are closing. Unpaid wages are given a high priority in bankruptcy anyway, so you are likely to get paid at least for the hours you have worked already.
    Answer Applies to: Oregon
    Replied: 4/7/2014
    Musilli Brennan Associates PLLC
    Musilli Brennan Associates PLLC | John F Brennan
    A Chapter 11 is normally a reorganization, and the business continues, or more accurately attempt to continue. Therefore, in the reorganization it may be necessary to cut costs and certainly all of the jobs in the enterprise are at risk.
    Answer Applies to: Michigan
    Replied: 4/7/2014
    GARCIA & GONZALES, P.C.
    GARCIA & GONZALES, P.C. | Richard N. Gonzales
    Maybe yes and maybe no. If the only asset the company has is the restaurant, and they are filing a Chapter 11 (a business reorganization), then they are likely going to continue with the business. Otherwise, they would have filed a Chapter 7 to simply walk away from their debts (and assets, assuming they have some).
    Answer Applies to: Colorado
    Replied: 4/7/2014
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    The point of a chapter 11 is to stay in business. So I don't know if you will lose your job. In chapter, 11 they try to reorganize to become profitable again.
    Answer Applies to: California
    Replied: 4/7/2014
    Law Office of Marlin Branstetter
    Law Office of Marlin Branstetter | Marlin Branstetter
    A chapter 11 bankruptcy would allow the business to reorganize. They might close or the could remain in business while they attempt to work out a reorganization plan with their creditors. There is no guarantee that you will not lose your job.
    Answer Applies to: California
    Replied: 4/7/2014
    Graves Law Firm
    Graves Law Firm | Steve Graves
    No, they don't have to close because of a Chapter 11 filing. In fact the major purpose of Chapter 11 is to let the debtor business stay in business. Let's hope their plan succeeds.
    Answer Applies to: Texas
    Replied: 4/7/2014
    Law Office of Michael Johnson
    Law Office of Michael Johnson | Michael Johnson
    Possible. Chapter 11 normally means they are trying to keep it going but needs to deal with its outstanding debt. Never a good thing but better than chapter 7.
    Answer Applies to: Florida
    Replied: 4/7/2014
    Rosenberg & Press
    Rosenberg & Press | Max L. Rosenberg
    No. Chapter 11 does not mean that they are closing. They are restructuring and taking care of their creditors.
    Answer Applies to: Connecticut
    Replied: 4/7/2014
    Goldsmith & Guymon
    Goldsmith & Guymon | Marjorie Guymon
    A Chapter 11 filing normally means the company will continue to operate, continue to pay its employees, and is attempting to restructure its old debt into more manageable payments.
    Answer Applies to: Nevada
    Replied: 4/7/2014
    Cameron Totten | Cameron Totten
    It depends on the reorganization plan that is approved by the restaurant's creditors and confirmed by the court. The creditors may elect to keep the restaurant open as that may result in a greater amount of their debt being paid back.
    Answer Applies to: California
    Replied: 4/7/2014
    Patrick W. Currin, Attorney at Law | Patrick Currin
    Usually a Chapter 11 tries to reorganize debt to keep a company going. This is not always successful.
    Answer Applies to: California
    Replied: 4/7/2014
    Law Office of Susan G. Taylor
    Law Office of Susan G. Taylor | Susan G. Taylor
    No, the restaurant should remain open. The case was filed in an attempt to get creditors to settle for less.
    Answer Applies to: Texas
    Replied: 4/7/2014
    A Fresh Start
    A Fresh Start | Dorothy G Bunce
    Most businesses that file Chapter 11 do so to restructure their debt to try to stay open. However, there is no guarantee that the chapter 11 will be successful, and I would be looking for other opportunities.
    Answer Applies to: Nevada
    Replied: 4/7/2014
    Law Offices of Eric W. I. Anglin
    Law Offices of Eric W. I. Anglin | Eric W. I. Anglin
    Not necessarily. Chapter 11 is reorganization and may allow the restaurant to continue to operate and eventually survive the reorganization or be sold. If the Chapter 11 or sale isn't successful then a Chapter 7 liquidation would occur and the business assets would be sold to satisfy the debts of its creditors.
    Answer Applies to: Indiana
    Replied: 4/7/2014
    The Schreiber Law Firm
    The Schreiber Law Firm | Jeffrey D. Schreiber
    A Chapter 11 is an attempt to stay in business, so if this is the only restaurant, that suggest they will not be closing. As a Chapter 11 is to reorganize, whether a reduction in employees is contemplated as part of that reorganization cannot be known at this time.
    Answer Applies to: California
    Replied: 4/7/2014
    Thomas Vogele & Associates, APC | Thomas A. Vogele
    No. In a Chapter 11 the debtor operates the business and tries to work out a plan to restructure its debts so it can be successful when it comes out of bankruptcy.
    Answer Applies to: California
    Replied: 4/7/2014
Click to View More Answers:
12 3 4 5 Free Legal QuestionsConnect with a local attorney