I have become my company’s creditor

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According to the National Union of Journalists, Utusan’s staff may not get their wages in the future. If you are owed your salary by your employer, what can you do? What are your rights?

If a company is wound up (tutup kedai), you need to wait in line to be paid.  You have become your employer’s creditor.

First, the secured creditors, normally banks.  They are not part of the queue.  They will take the assets charged to them (normally landed assets) and sell them on their own. If the amount received is less than what is owed, they will join the unsecured lenders in the queue for the balance.

For the rest, the liquidator will sell the company’s assets and distribute the money in the following order of priority:

  1. Winding up costs, including the liquidator’s remuneration;
  2. Employees’ wages and salaries (including commission) capped at RM15,000
  3. Workers’ compensation
  4. Vacation leave
  5. EPF
  6. Federal tax
  7. Unsecured creditors e.g. suppliers, and unsecured lenders
  8. Shareholders

Are you in this situation? Learn about legal rights and other updates and debt recovery at Symphony’s 26th September training.