Filing for insolvency: Will Galeria employees receive insolvency money again?

According to information from the German Press Agency, the chances of receiving insolvency money for the 12,000 employees of the 83 Galeria branches could be better than initially expected. The department store chain filed for insolvency at the Düsseldorf District Court last Friday - the fourth in six years.

According to the general legal opinion of many insolvency law experts, the insolvency money should not actually be paid because the payment problems from the previous insolvency in 2024 have not yet ended. The company is still in so-called plan monitoring - according to the current legal opinion, this is practically a reason for exclusion from further payment.

But: The company Galeria Karstadt Kaufhof GmbH, which went bankrupt in 2024, still exists. However, after 2024 the business activity has now been transferred to Galeria S.à r.l. & Co. KG - and according to the entries in the corresponding insolvency registers of the Düsseldorf and Essen district courts, this legal entity is not in the plan monitoring. Employees of this company could therefore be formally legally paid insolvency money.

Insolvency money is borne by companies

According to dpa information, the provisional insolvency administrator Frank Kebekus has applied for the payment of insolvency money. It should be pre-financed through a bank and therefore paid out more quickly. According to reports, the salaries of Galeria employees are currently almost 25 million euros per month. It is unclear when the Federal Employment Agency will make the decision. This is expected to fall shortly.

The payment is eagerly awaited by employees and trade unionists, but viewed critically by others. Insolvency money comes from pay-as-you-go financing, which is not financed from taxes or contributions, but is borne exclusively by the employers - including the department store chain's competitors. The Federal Employment Agency calculates a total of 1.5 billion euros for insolvency money for 2026; last year the expenditure was 1.7 billion.

A three-digit million sum has already been paid out to Galeria employees from this pot in three waves of insolvency since 2020.