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Canadas Feds Turn Cold Shoulder to Nortels Disabled Workers

A Senate committee in Canada has shot down a proposed law that would have kept long-term disabled workers from being treated as unsecured creditors in bankruptcy proceedings, according to the Wall Street Journal.

The catalyst for the bill was the January 2009 insolvency of Nortel Networks, once one of Canadas largest employers. Indeed, the potential law would have allowed Nortel employees who will lose their benefits in just a few weeks to act as preferred creditors. Such a change would have been a first step toward improving benefits security for disabled workers.

But a committee late last week voted against the proposal, and the whole Senate sometime soon will have to vote on whether to accept that decision.

"I think it’s deplorable that they’ve turned their back on some of the most disadvantaged citizens," Sen. Art Eggleton, a Liberal government appointee, told the Journal. "It’s hard to believe why the government would abandon these people because it means the taxpayer will end up picking up the bill because these people will go on to social assistance rather than Nortel picking up the bill out of their assets."


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