Banked time

March 27th, 2007 by Questions

One of our clients is an employer who has an employee who is currently an undischarged bankrupt. This employee has worked extra time and is entitled to additional pay. This would be surplus income to the bankrupt person.

The employee has suggested to his employer that this additional income be banked, to be paid after the employee is discharged from bankruptcy. This would probably be a problem for this employee when it came to be discharged as they would not have reported all their income while a bankrupt. In short, the employer would be wise to instruct the employee that this banked time arrangement would not be acceptable.

Is it correct that the banking the additional time would not be an acceptable procedure for the bankrupt employee?


2 Responses to “Banked time”

, Barton Goth GCO Bankruptcy Trustees said:

You are correct, this type of arrangement would not be an acceptable procedure for the bankrupt employee and potentially places you as the employer at risk.

, A licensed trustee said:

Unfortunately, you will need to direct this question to your employee’s trustee directly. As a trustee, I can think of a scenario underwhich this might be acceptable – I can also think of examples when it most definitely would not be.

If your employee won’t tell you who their trustee is then you probably have to err on the side of caution and not allow them to bank any time.

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