Employees Under The Insolvency And Bankruptcy Code 2016 - JK Jute Mill Case

Alind Gupta, University of Petroleum and Energy Studies (UPES)

ABSTRACT

The Insolvency and Bankruptcy Code 2016 introduced much needed reform in the insolvency laws of India. The architecture of the Code divides creditors into two classes: financial and operational. While employees fall under the latter category, the Supreme Court in JK Jute Mill case held that even a trade union can file application for corporate insolvency resolution process as operational creditor. This is a step in the right direction. However, it encourages us to grapple with the interplay with labour law and insolvency law. Part 1 of the paper paints a brief background of the Insolvency and Bankruptcy Code. Part 2 looks at the position of employees within the Code before focusing on the ruling of the Supreme Court in JK Jute Mill case. Part 3 offers an international perspective on the position of employees under the Insolvency laws. Part 4 points out certain challenges that may arise owing to the inclusion of trade unions in the insolvency process.