Workers’ Compensation and Bankruptcy

A person injured at their place of work may be allowed to file for workers’ compensation, which provides important financial protection from the expenses of an injury. However, bankruptcy can have a substantial impact on these compensation packages. There are some exemptions available in the state of Alabama that can help protect most of these benefits.

If you need legal assistance managing workers’ compensation exemptions during bankruptcy, we may be able to help. For more information regarding your rights, contact the Birmingham bankruptcy lawyers of [firm-name], at [phone-number] today.

Exemptions for Workers’ Compensation

Workers’ compensation often consists of multiple components built into a single package. This compensation consists of coverage for issues such as long- or short-term disability, time away from work, and even coverage for separate expenses such as travel. According to Alabama’s bankruptcy exemptions, the following have legal protections during bankruptcy:

  • Workers’ compensation claims
  • Disability proceeds up to $250
  • 75% of earned but unpaid wages

While this compensation is generally protected, other expenses may not be protected by the law. Depending on how these payments are linked to compensation claims, they may or may not apply under the compensation claim exemption. Unfortunately, if a person has been permanently injured, they may not be able to collect their full disability proceeds.

Contact Us

If you have been injured at work and have received compensation, this money may be impacted by bankruptcy garnishments and collection. To learn more about your exemption options and how a bankruptcy attorney can help protect your money, contact the Birmingham bankruptcy attorneys of [firm-name], today by calling [phone-number].

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