informed employees of the filing late Friday […] that it had filed for a debtor-in-possession loan — a way for companies that are reorganizing after filing for bankruptcy to secure additional working capital to meet payroll. […] employees have been waiting for paychecks since June 21st […] it’s not certain that the company will be able to secure such a loan.
Chicken Soup took on $325 million in debt when it acquired Redbox in 2022 and has since been sued over a dozen times over unpaid bills.
One of the few good legal standards around bankruptcy is that unpaid wages to workers are actually, surprisingly paid out of assets prior to investors getting their cut.
I’ll agree that’s a good thing, but that depends on there being assets (likely in this case), but it also means workers may have to wait months or years before the bankruptcy proceedings are complete. That shouldn’t be a burden lower wage workers have to shoulder.