Stephanie Kalinowski Quoted in CBC News on Pension Plans and Corporate Bankruptcy: Why Pensioners Aren’t First in Line

Stephanie Kalinowski Quoted in CBC News on Pension Plans and Corporate Bankruptcy: Why Pensioners Aren’t First in Line

The news of retailer Sears filing for bankruptcy has sparked a conversation about the future of pension plans which are not fully funded, when an employer goes under. Canadian law does not prioritize pensioners with regard to dividing up assets during bankruptcy proceedings.

When asked why are pensioners are not given priority in bankruptcy proceedings, Stephanie advised, “granting pensioners priority in bankruptcy proceedings is a difficult policy issue.” “Businesses, for all kinds of valid reasons, borrow money from creditors … and if creditors know that should something happen, and the company becomes insolvent, that suddenly their money vanishes, how does that affect their lending decisions?” Stephanie posed.

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