What happens if the administrator closes the company without paying the workers?

Real case: conviction with personal liability for unpaid wages.

When a company ceases to operate without following legal procedures, the consequences can be serious, especially for the administrator. This was recently confirmed by the Provincial Court of Murcia, which convicted an administrator of being liable with his personal assets for unpaid wages owed to two workers following the irregular closure of the company.

A company with losses... but with clear legal obligations

The court considers it proven that the company had accumulated significant financial losses and was in a situation that legally obliged the administrator to act. Specifically, there was legal cause for dissolution, but neither the dissolution of the company nor the declaration of bankruptcy was pursued.

In addition, since the end of 2017, the workers had not been paid their wages. Despite this, business activity continued for months, a decision which, according to the ruling, aggravated the damage to the employees.

There were sufficient assets to pay the wages

A decisive factor in the case is that, despite subsequent losses, the company had assets of more than three million euros in 2017. This led the court to conclude that the workers could have received all or part of their wage claims if the correct and legal action had been taken.

Instead, the administrator kept the business running until September 2018 and ended up closing the company in March 2019, without an orderly liquidation and without guaranteeing the payment of labor debts.

The “de facto” closure and asset stripping

The ruling places special emphasis on what is known as the de facto closure of the company. In other words, a closure in practice, but without complying with the required legal procedures. During this period, there was a very significant reduction in assets, without sufficient accounting justification.

This behavior is described by the court as fraudulent or, at the very least, grossly negligent, as it prevented workers from receiving their wages.

When the administrator is liable with his personal assets

The Provincial Court recalls the doctrine of the Supreme Court according to which, when the administrator's actions cause direct damage to creditors, they can claim damages from him personally. In this case, all the requirements are met: illegal conduct, economic damage, and a direct relationship between the two.

For this reason, the ruling confirms the order to pay the outstanding wages, with interest, and imposes the costs of the appeal on the administrator.

A clear warning for administrators and business owners

This real-life case is a clear reminder that closing a company without doing so correctly can be very costly. When there are serious losses and debts to employees, the administrator has an obligation to act within the legal framework. If they fail to do so, they may end up being liable with their own assets.

SAP Murcia, Fourth Section, December 6, 2025 (EDJ 2025/802189)

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