Section 1 Short title
This Act may be cited as the “No Bonuses in Bankruptcy Act of 2018”.
No Bonuses in Bankruptcy Act of 2018
A BILL
To amend title 11 of the United States Code to prohibit the payment of bonuses to highly compensated employees and insiders of the debtor to perform services during the bankruptcy case; and for other purposes.
Sec. 2 Amendments
Title 11 of the United States Code is amended—
in section 503 by adding at the end the following:
“(d)
“(1) Notwithstanding any other provision of this section, there shall neither be allowed nor paid a bonus to—
“(A) a person employed at an annual rate of compensation exceeding $250,000 by the debtor at any time in the year ending on the date of the filing of the petition; or
“(B) an insider of the debtor.
“(2) For purposes of this subsection, the term “bonus” means a transfer to, or obligation incurred for the benefit of, an employee or insider as compensation for services in an amount that—
“(A) is in addition to the existing employee’s or insider's wages or salary;
“(B) is in addition to existing base compensation of the employee or insider; or
“(C) can be construed as a form of retention, incentive, or reward related to the employee’s or insider's employment by the debtor.”
in section 547(b)(4)(B) by striking “insider” and inserting “an employee employed at an annual rate of compensation exceeding $250,000 by the debtor at any time in the year ending on the date of the filing of the petition or an insider of the debtor”; and
in section 548(a)(1)—
in the matter preceding subparagraph (A) by inserting “a person employed at an annual rate of compensation exceeding $250,000 by the debtor at any time in the 2-year period ending on the date of the filing of the petition or” after “benefit of” each place it appears; and
in subparagraph (B)(IV) by inserting “a person employed at an annual rate of compensation exceeding $250,000 by the debtor at any time in the 2-year period ending on the date of the filing of the petition or” after “benefit of”.
Sec. 3 Effective date; application of amendment
Effective date— Except as provided in subsection (b), this Act and the amendment made by this Act shall take effect on the date of the enactment of this Act.
Application of amendment— The amendment made by this Act shall apply only with respect to cases commenced under title 11 of the United States Code on or after the date of the enactment of this Act.