ABSTRACT
This chapter discusses the most common and largest group of statutory priority creditors, the employees. The treatment of employees as priority creditors has been longstanding. In this chapter the relevant early statutory history is depicted to complement what has already been said in Chapter 2.1 After a brief discussion on some judicial comment as to the employee priority, the relevant subsections of s556 of the present Australian Corporations Act 2001 (Cth) are analysed. Today there is considerable debate with respect to the employees’ position in an insolvent company. The Australian Federal Government has played a major role in this debate. There has been a dramatic shift in the role that employees play in corporate insolvency. This has been grounded, in part, in the long-term statutory priority.
