Instant Brands Files Bankruptcy

Why has Pyrex kitchenware manufacturer filed for bankruptcy?

Pyrex kitchenware manufacturer, Instant Brands, has filed for bankruptcy due to excessive debt and the impact of rising interest rates and stricter credit conditions. The company, along with 14 affiliates, sought Chapter 11 protection from creditors in southern Texas.

Instant Brands holds assets and liabilities of up to US$1 billion. However, it intends to continue operating while undergoing restructuring, with US$132.5 million in financing already secured. The company’s CEO, Ben Gadbois, cited the tightening of credit terms and higher interest rates as reasons for the unsustainable capital structure. Notably, entities outside the United States and Canada are not seeking court protection.

What brands are affected by the bankruptcy?

Instant Brands’ product lineup includes Instant Pot pressure cookers and Corningware, in addition to Pyrex brand.

The impact of bankruptcy on severance pay?

Unfortunately, if an employer is too far in debt to save itself or go through a receivership, and is forced to file for bankruptcy, there are implications for employee severance. This can be an incredibly stressful time for employees, who have not only lost their jobs but now face uncertain prospects for recovering severance payments. Some employees may even be owed unpaid wages that accrued prior to the bankruptcy as well.

Bankruptcy does not excuse employers from paying severance and unpaid wages owed to employees. However, the reality may be very unpleasant for employees in these circumstances. An employee becomes an unsecured creditor to its bankrupt employer, and must get in line behind other creditors, such as taxes owed to the government and debts held by secured creditors like banks, who are also needing to be paid.

The federal government has put some protections in place for employees in these circumstances. The Wage Earner Protection Program (WEPP) assists employees who worked for bankrupt companies and are owed outstanding wages. WEPP will pay a limited amount of unpaid wages to the date of the bankruptcy or receivership. For employees that were formally terminated, WEPP will generally pay out any termination pay, and severance owed as well. There are important timelines to remember for the WEPP program, so employees should be sure to speak with an employment lawyer as soon as possible to understand their rights and obligations.

How can Whitten & Lublin help?

If you or someone you know is dealing with a bankrupt employer, it is important to speak with an experienced employment lawyer to understand your workplace rights. The employment lawyers at Whitten & Lublin can help you navigate your legal options regarding your specific circumstances. If you are looking for employment lawyers and would like more information about what Whitten & Lublin can do for you, please contact us online or by phone at (647) 946-1276.