From the archives, I was writing quite often after I was laid off from Nortel, and this was on the day Nortel Declared Bankruptcy. In retrospective it was good that I got laid off, but the bankruptcy (January 2009) was horrible for many good people.
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 really 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 did not receive much money, and are owed millions.
- Pensioners, what happens to the pension plan which is already under funded? In bankruptcy protection what happens to the Pension liability?
- Current employees who were hoping to be laid off and getting a fair severance package? Rumor has it that lay offs are on hold, due to a lack of funds to pay them out? Sounds like an interesting rumor, but completely unsubstantiated as well.
- There are a couple of employees that work for Nortel the company, but they are lawyers.
What did the Future Hold
Under bankruptcy protection a quick sale of Nortel may happen as well (it didn’t), and if that happens the creditors of the “old” Nortel may well have more issues dealing with the new owners as well.
Epilogue from a long time after: In hindsight Nortel was such a mess with its Pension under funding, 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).