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  1. #1
    Join Date
    Apr 2007
    Location
    Southeastern Michigan
    Posts
    1,226

    Question Payment of Bonuses To The Trustee

    I was to receive a $500 bonus back in March of this year. After a few months of tracking it down, I found out last week that my employer applied the money to my bankruptcy. My employer indicated they sent the information to our legal department. Our legal department contracted an outside legal firm for 'guidance' on these matters and that firm indicated that the money should be sent to the trustee and not given to the employee.

    I contact my attorney who indicated that my employer is in error and has done this in the past. They were sent a letter from my attorney last year when this happened with about 10 of his clients whose bonus checks were erroneously applied. However, my employer indicated that until further notice, bonuses would be applied to an employee's bankruptcy, no matter what the court order specifies.

    It will cost be about $400 to get the money back (not worth it) so it's not really worth it but my question is; Is it legal for my employer to be doing this, even if a court order states otherwise? Between this and my FOC payments being screwed up, I'm getting a little 'frustrated'.

  2. #2
    Join Date
    Mar 2005
    Location
    Michigan
    Posts
    28,906

    Default Re: Can they legally do this?

    What does the court order that was served on your employer say about bonuses?

  3. #3
    Join Date
    Apr 2007
    Location
    Southeastern Michigan
    Posts
    1,226

    Default Re: Payment of Bonuses To The Trustee

    My attorney read the order and it states a semimonthly deduction of $XXX; income tax returns, commissions and bonuses are those of the debtor as the plan is 100% funded.

    The problem is that I was told my employer doesn't review each individual order; they don't have the resources to do this. They 'consulted' with an outside firm who instructed them to send the monies to the trustee; just to be safe!

  4. #4
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,846

    Default Re: Payment of Bonuses To The Trustee

    It should all come out in the wash - you should get credit for the $500, even if you can't presently put it into your pocket. As you have determined that it is not economically reasonable to bring a motion for the return of the money, I don't think there's a viable remedy here. Is that what your lawyer told you?

  5. #5
    Join Date
    Apr 2007
    Location
    Southeastern Michigan
    Posts
    1,226

    Default Re: Payment of Bonuses To The Trustee

    Quote Quoting Mr. Knowitall
    View Post
    It should all come out in the wash - you should get credit for the $500, even if you can't presently put it into your pocket. As you have determined that it is not economically reasonable to bring a motion for the return of the money, I don't think there's a viable remedy here. Is that what your lawyer told you?
    Pretty much. I was planning on using the money to fix my van but that's a moot point now; when you're in bankruptcy any little bit helps.

    It just amazes me what BIG corporations can get away with; Business should be held accountable just as us worker bees are. God help our souls if we ever disobeyed a court order. Bureaucracy at it's finest!


    Thank you for your feedback.

  6. #6
    Join Date
    Mar 2007
    Location
    Kentucky
    Posts
    11

    Default Re: Payment of Bonuses To The Trustee

    It's a longshot, but you might see if you can get your Ch13 Trustee in your corner. It couldn't hurt to call and see if he/she can help.

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