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Ban on Executive Bonuses Before and During Bankruptcy Proceedings

New rules aim to prevent high-earning individuals and company insiders from receiving bonuses just before or during bankruptcy proceedings. This means individuals earning over $250,000 annually will not receive additional bonuses, protecting company assets for creditors and other stakeholders. These changes could enhance trust in the bankruptcy process and ensure a fairer distribution of funds.
Key points
Prohibits bonus payments to individuals earning over $250,000 annually within a 2-year period ending 1 year after bankruptcy filing.
The ban also applies to company insiders and individuals whose bonus would push their annual compensation above $250,000.
Exemptions include sales commissions and benefits from collective bargaining agreements.
The goal is to protect company assets during financial distress and prevent unfair practices.
The provisions take effect upon enactment and apply to bankruptcy cases commenced thereafter.
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Expired
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Additional Information
Print number: 117_HR_428
Sponsor: Rep. Steube, W. Gregory [R-FL-17]
Process start date: 2021-01-21
Lustra uses Artificial Intelligence. Verify details in source documents.
Summarized by: gemini-2.5-flash
Source data: api.congress.gov
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OFFICIAL LEGAL TITLE

No Bonuses Ahead of Bankruptcy Filing Act of 2021

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 117_HR_428.

Which chamber initiated this legislation?

This legislation was initiated in the House of Representatives.

When did the legislative process begin?

The process officially started on 2021-01-21.

What are the main provisions?

Key points include:

  • Prohibits bonus payments to individuals earning over $250,000 annually within a 2-year period ending 1 year after bankruptcy filing.
  • The ban also applies to company insiders and individuals whose bonus would push their annual compensation above $250,000.
  • Exemptions include sales commissions and benefits from collective bargaining agreements.
  • The goal is to protect company assets during financial distress and prevent unfair practices.
  • The provisions take effect upon enactment and apply to bankruptcy cases commenced thereafter.
What is the specific legal status?

The current status is Expired.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Rep. Steube, W. Gregory [R-FL-17].

What is the latest detailed status?

The latest detailed status is: Referred to the Subcommittee on Antitrust, Commercial, and Administrative Law.

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2026-01-02.

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Courts and Law Economy