The U.S. Supreme Court held today in a 6 to 2 decision that “structured dismissals” resolving Chapter 11 bankruptcy proceedings cannot deviate from the Bankruptcy Code’s priority scheme without the consent of the affected parties – which means that businesses must ensure workers receive their unpaid wages as part of any such resolution. Specifically, the Court rejected a structured dismissal that left a group of WARN Act plaintiffs without any compensation, telling employers, essentially, that they must squeeze blood from a stone to compensate their workers.
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