Is a request for judicial recovery the same as bankruptcy? Understand!

Talk about request for judicial recovery has become very common, especially after the pandemic, when many companies saw their numbers plummet.

What is a request for judicial recovery?

If you have been following the media in recent years, you have probably seen frequent reports about bankruptcy filings.

A case with good repercussions was that of the famous Americanas chain, which in 2023 filed for judicial recovery in the Brazilian courts, claiming to have a debt of R$43 billion with approximately 16 thousand investors.

When the news came out, many doubts arose, especially from the network's employees, who were worried about their jobs.

But, after all, what is this?

A request for judicial recovery is nothing more than a legal procedure, in which the company requests a period for financial recovery, in an attempt to avoid bankruptcy.

The idea is for the company to use this period to attempt negotiations with creditors, and thus be able to rebalance the business's accounts and recover it.

In general, when a company files this type of request, it is because it has identified a significant hole in its finances, responsible for serious losses and a high chance of the business going bankrupt.

Is filing for judicial recovery the same as bankruptcy?

At this point, you already have a good understanding of what a request for judicial recovery is, and what the purpose of this procedure is.

But remember we talked about how many employees worry about their jobs when the company opens this request?

This is especially due to the fact that many believe that filing for judicial recovery and bankruptcy are practically the same thing.

However, as we have seen, in practice the request for judicial recovery serves precisely to avoid bankruptcy.

So, no, a company that files this request is not declaring bankruptcy, although there is a risk of this happening if the recovery attempt is unsuccessful.

It is a fact that in the recovery process it is common to have cost cutting, after all, to resolve financial issues it is necessary to reduce expenses.

So, a large part of the employees end up going through the dismissal process, and for them, the result of recovery or bankruptcy is the same.

In any case, what you should know, if you are an employee, is that simply requesting recovery does not mean that the company will close, or that you will lose your job.

This may interest you: Does the salary come with the termination? Understand and learn how to proceed! (oadministrador.com).

The company I work for has filed for bankruptcy protection: what now?

If for a company the request for judicial recovery is worrying, for employees this news can generate doubts and anguish.

This is because knowing that the company you work for is facing serious financial problems gives you a feeling of “tightrope walking”.

If you are going through this right now, the first thing you should do is stay calm, because as we said before, this request is not synonymous with bankruptcy.

So, if the procedure brings results and the company manages to recover, the situation is resolved.

However, we cannot deny that in many cases, cutting staff is the first step towards recovery, as it contributes to reducing expenses.

So, the possibility of going through a dismissal process is not remote. But don't worry, because if this happens, you will leave with all your labor rights guaranteed.

This is because, in this case, the dismissal occurs without just cause, on the part of the employer, therefore, you are entitled to the 13th salary, FGTS fine and unemployment insurance, if you meet the requirements.

And, considering that the recovery request serves precisely to avoid bigger problems, companies that request the procedure usually bear the cost of paying the terminations.

In any case, stay calm and wait for the next steps, as it is likely that you will not be harmed.

++The company I work for is going to close. What now? What to do? (oadministrador.com).

The company declared bankruptcy and did not pay my severance pay: what should I do?

In some cases, the request for judicial recovery ends up not bringing results, or the company does not even request it before declaring bankruptcy.

The second situation in particular ends up being quite complicated, as there are many examples where the company has declared bankruptcy and has not paid the severance pay to former employees. What does the law say about this?

There is no law that exempts a company from the obligation to pay severance pay to dismissed employees in the event of bankruptcy.

Therefore, when the company fires you and does not bear the costs of termination, it must be taken to court to ensure that it complies with its responsibilities.

Here are two fundamental tips for dealing with this situation:

1. Check your FGTS and unemployment insurance account deposits

The first thing you should do after going through the dismissal process is to check your FGTS account, and the possibility of receiving unemployment insurance.

This measure is important for 2 main reasons:

It is not uncommon for workers to discover after terminating their contract that the company never made deposits into their FGTS account, and therefore they have nothing to withdraw. This practice is illegal.
By withdrawing at least the FGTS and receiving unemployment insurance, you can support yourself for a period, until the problem with the severance pay is resolved.

2. Seek professional guidance

A good lawyer can help you solve the problem of non-payment of severance pay through a labor lawsuit.

The purpose of this process is to expose the lack of payment (which in itself is already illegal), and to judicially require compliance with the obligation.

This way, no matter how long it takes, you will have the guarantee that the courts are aware of the non-compliance and will work to resolve the problem.

In any case, the important thing is to stay calm and seek appropriate guidance to resolve your problem and soon get a new job to overcome this difficult phase.

Roberta June 17, 2024

Business