From the archives. I was writing quite often after I was laid off from Nortel. This was on the day Nortel Declared Bankruptcy. In retrospective it was good that I got laid off. The bankruptcy (January 2009) was horrible for many good people.
Estimated reading time: 3 minutes
In the news, the past few days have been talk of the former Telecom Juggernaut Nortel filing for Bankruptcy protection due to a loan repayment that may be due this week (there is no clear statement that this is actually the case).
What does this mean?
To the folks still working there, not too much, life will go on, and their jobs will most likely continue for now.
The concerns I am hearing are from an interesting cross-section of former and current Nortel employees:
- Folks who have just been notified of their redundancy, however, they have not received their severance packages yet. If the company files for bankruptcy protection, what happens to these agreements
- Unfortunately, folks with severance packages received little money and are owed millions.
- Pensioners, what happens to pension plans that are underfunded? In bankruptcy protection, what happens to the Pension liability?
- Pensioners took a big hit and lost their medical coverage as well.
- Another area I didn't know about was that those who were on long term disability lost their coverage, as Nortel was self-insuring.
- Current employees hoping to be laid off and receive a fair severance package? Rumour has it that lay-offs are on hold due to a lack of funds to pay them out. Sounds like an interesting rumour, but completely unsubstantiated as well.
- There are a couple of employees who work for Nortel, the company, but they are lawyers.
What did the Future Hold
Under bankruptcy protection, a quick sale of Nortel may occur (it didn't), and if it does, the creditors of the "old" Nortel may have more trouble dealing with the new owners.
Epilogue from a long time after: In hindsight, Nortel was such a mess with its pension underfunding and managerial blundering; it was obvious (in hindsight) that it would never come out of bankruptcy protection (but that is with the aid of hindsight).
Nortel related articles
- On Being Laid Off (a retrospective) what had I learned the 10 years after getting laid off.
- A Year Ago, written a year after that day I was laid off luckily I was waiting to start a new job
- Sometimes it is better to be lucky a retrospective about how lucky I was to get laid off when I did. Read on to find out why.
- Pensions and Severance an important topic I took from my layoff from Nortel.
- Twenty Years in One Line is what my severance letter did. My 20 years are summed up in a sentence.
- Financial Issues With Severance what do you do with your severance if you have options? If you get severance as well.
- On Being Laid Off my explanation of being laid off from Nortel, a day or two afterwards.
- Nortel Still Paying Out? Really, well not that much.
Not surprising, really. But there is a nostalgic part of me that is sad. But mostly I feel for the remaining employees. I’m guessing that the remaining shareholders knew it was a risky play.
Well, it’s official. NT did file for bankruptcy protection. Interesting questions that are likely to be discussed widely over the next few weeks.
Fully agree. I think that this will surely happen…