The Social Policy and Labour Committee upholds the Bill on Amendments to the Law of Ukraine ‘On a Debtor´s Solvency Renewal or a Declaration of Bankruptcy´ (appertaining to the sequence in which the demands are met through Wage Arrears)
The Sponsors of this Bill (Reg.No.1105), People´s Deputies, L. Denisova, A. Senchenko and V. Makienko, substantiate the need for this Law to be adopted through the sizeable arrears of wages, collected over several years, usually in Bankrupt businesses which do not effect payments to their staff. They tend to meet wage demands in the second place, and are often unable to pay the debts to their staff through a lack of liquidation mass. This is a direct infringement of Article 43 of The Constitution of Ukraine.
The proposed alterations to the current Law change the sequence in which creditors´ demands should be met, i.e. wage arrears are moved from second to first position in this sequence.
The Bill envisages that where a legal entity is declared bankrupt, it shall not only meet wage arrears demands for the three months preceding the filing of bankruptcy, or termination of labour relations, together with several other pay-offs in connection with labour relations, pursuant to the current version of Article 31 of the Law of Ukraine ‘On a Debtor´s Solvency Renewal or a Declaration of Bankruptcy´, but also nearly all demands arising from the Bankrupt´s liabilities to his staff, whenever they arise. It is also proposed to attribute the obligations of payment of insurance premiums towards the Obligatory State Social Insurance as to a demand which should be met in the first place.
The Committee forwarded its decision to the Economic Policy Committee, which is a Lead Committee responsible for preparation and elaboration of this Bill.