In this case, a trustee of a bankruptcy estate filed objections in the bankruptcy court to the requested priority treatment of a portion of severance compensation claims filed by the debtor’s former employees (the claimants). The bankruptcy court overruled the trustee’s objections and, under 28 U.S.C. §158(d)(2)(A)(i), certified an appeal to this Court.
On appeal, the trustee contends that the claimants “earned” their severance compensation over the entire course of their employment. The trustee asserts that, therefore, under 11 U.S.C. §507(a)(4), only a pro-rated portion of the claims was “earned” within 180 days preceding the bankruptcy petition and was entitled to priority treatment. The Court disagreed with the trustee’s position, and concluded that the claimants “earned” their severance compensation on the date they became participants in the debtor’s severance plan immediately after their termination from employment.
Affirmed.