News / Business
Kodak asks New York Bankruptcy Court to Cut Retiree Benefits
Just one month after Kodak sought Chapter 11 bankruptcy protection in a New York court, they asked for permission to cut health care benefits for thousands of retirees.
The Rochester, New York-based company has twice as many retired employees as it active employees. In a letter to retirees obtained by Rochester station WHEC Kodak said that the company has sought to “balance the needs of the retirees along with the needs of the company.”
However, Kodak is now asking to discontinue healthcare benefits for retirees 65 and older or anyone under the age of 65 who are eligible for Medicare.
The company said that this year alone it is liable for $1.2 billion in retiree benefits such as healthcare. A New York bankruptcy attorney will suggest a number of ways that a failing company can cut costs and this affects retired employees in many circumstances.
A hearing is scheduled for March 20 to hear the motion. If approved, the motion will affect close to 13,000 retired employees. The changes would go into effect on May 1st and will allow the company to exit Chapter 11 sooner.
Companies seek the counsel of a New York bankruptcy lawyer when they are faced with overburdening debt. Bankruptcy protection gives them the opportunity to eliminate or reduce their liabilities so they can return to profitability. With the help of a New York bankruptcy attorney, a troubled business will be able to keep from going under.
