Corporate Debt And Workforce Protection: Legal Challenges In Financial Restructuring
- IJLLR Journal
- Mar 30
- 1 min read
Ishita Chikara, LLM, Hidayatullah National Law University, Raipur
ABSTRACT
By virtue of its contention and difficulty, the issues of corporate debt and worker protection fallen in the realm of financial restructuring become immediate emotions during a corporate debt restructuring among the debtors and creditors on one hand, trying to secure monetary recovery under restructured forms, while on the other hand trying to protect the remaining employee rights guaranteed under the operating statutes. Under extreme financial hardship, it becomes paramount to initiate a restructuring of the instruments, such as debt-for-equity exchanges, creditor negotiations, insolvency proceedings, and so forth. However, these acts usually cast a blind eye to social justice or the rights of workers. This essay, by discussing the implementation legislation surrounding corporate debt restructuring and labour protection, presents the undergoing conflict between these two interests-the labour rights and the creditors. This study's objective will be to suggest mutually agreed equitable legal mechanisms to arrive at a compromise between the business sustainability interests of the company and the interests of the employees. The study analyzes existing literature, case law, and international best practices.
