Payouts start

KTM

More than 3600 employees are affected by the insolvencies at motorcycle manufacturer KTM.

(Bild: Wenzel Markus)

It was a shock in combination with the opening of insolvency proceedings at motorcycle manufacturer KTM: in one fell swoop, more than 3,600 employees were fearing for their jobs as well as their November salaries and wages and most of their Christmas bonuses. Now the wait is over: the insolvency compensation fund is starting to pay out.

After the wage data from KTM had initially been delayed, the insolvency law department of the Upper Austrian Chamber of Labor finally filed the employees' claims with the court on December 19 and at the same time applied to IEF-Service GmbH, which manages the insolvency pay fund. Three weeks later, the final formalities were also clarified: the restructuring administrators Peter Vogl, Robert Tremel and Franz Mitterbauer completed their audits.

This means that the insolvency compensation fund can now start making payments to KTM employees, who will now receive their November salaries and wages as well as the majority of the Christmas bonus that the motorcycle manufacturer owed its workforce in just a few days.

Already three subsequent bankruptcies

On November 29, restructuring proceedings with self-administration were opened for KTM AG, KTM Components GmbH and KTM Forschungs & Entwicklungs GmbH. The total liabilities for these three companies are stated at around two billion euros.

Since then, there have been three subsequent bankruptcies in the group: Vöcklabrucker Metallgießerei slipped into bankruptcy on December 13, Avocodo GmbH and Pierer E-Commerce GmbH have been in restructuring since January 7.

"In all likelihood, all payments will be made around 20 January," the management of IEF-Service GmbH said in response to an inquiry from Krone, while also revealing: "Payments will be made in stages, starting next week." This means that the first employees should be able to see the money in their accounts around January 14 or 15. 

AK submitted around 3500 applications with powers of attorney
How much money will flow to the employees affected by the mega-bankruptcy? There is talk of 20 million euros, which will now be transferred as part of the initial payments. The insolvency law team of the Upper Austrian Chamber of Labor led by Karoline Neumüller was able to submit around 3500 applications to the fund on the basis of powers of attorney.

Second wave of redundancies rolls in
The workers will also receive their wages again for the first time next week - namely their December wages, which are due in mid-January. The KTM employees had received their December salaries at the end of December.

The situation has become extremely precarious for some of the employees since the opening of insolvency proceedings, and there is also uncertainty. At the beginning of December, 250 redundancies were announced and by January 17, a further 300 employees, mainly salaried staff, will lose their jobs.