“The related application that will be presented to the Ministry of Labour in the forms provided for by current legislation will concern 38 workers for a duration of twelve months starting from 22nd January…”
The bankruptcy trustees of Italian bioplastics firm Bio-on have said that they have agreed to apply for an “extraordinary wages guarantee fund”. This news comes after the company announced bankruptcy following a court decision in Bologna, Italy, last month.
On 20 December 2019, the court also ordered the “temporary continuation” of the company’s economic activity in order to maintain business continuity and avoid the dissolution of the firm, Bio-On said in a statement.
The statement went on to note the banking system’s “lack of willingness” to grant new financial facilities, adding that the payment of the salaries of the employees could only be possible after receiving new credit.
Bio-On came under severe financial pressure and legal investigation following a report in July 2019 by the New York-based asset management firm Quintessential Capital Management, which claimed Bio-On was “a house of cards, a scheme conceived by management to enrich themselves on at the expense of shareholders.”
In addition to this, the company announced in November that it was suspending any type of payment, including to employees, suppliers and credit institutions, due to an ongoing judicial investigation into its performance.
However, today (22 January), the company has put out a statement to announce that its bankruptcy trustees will apply for an “extraordinary wages guarantee fund” to the Italian Ministry of Labour.
Under Italian employment law, the fund initiative aims to safeguard employment by providing funds to enable companies in crisis to either continue operating or sell their business, by rehiring redundant employees. Companies may request access to this wage subsidy if they are ceasing or have already ceased, production, even partially to help their employees.
In a statement, Bio-on said: “The related application that will be presented to the Ministry of Labour in the forms provided for by current legislation will concern 38 workers for a duration of twelve months starting from 22nd January with possible reduction of hours or suspension to zero hours per week.”
Based in Bologna, before it declared bankruptcy, Bio-On was commercialising polyhydroxyalkanoate (PHA) resins, a biodegradable polyester made by bacterial fermentation.