In an ideal world this would be feasible. Few people have the pricing power for their labor to do this. I'd classify what you call a failed business transaction as a failure of government to enact necessary labor laws.
Yes, this is something that can be fixed by law. At least my native country Finland has a sort of public bankruptcy insurance (“palkkaturva”) that extends automatically to all employees.
In the event of a bankruptcy leaving you with unpaid wages, you file an application with the same office that handles unemployment benefits, and they will recompensate you. C-level managers are exempt.
This is something entirely different. And FYI a strong incentive for companies to never offer any kind of severance in these situations since it's all socialized.
Better to just be transparent about things so employees can properly consider the risk in the situation.
The issue here is that a bankrupt company is breaking the contracts it made with employees — and you suggest it can be fixed by having employees enter into another contract with the same company. Do you see the problem?
What company is going to advertise months in advance that they might be going bankrupt? That's the surest way to make it come true.
This seems like some kind of weird libertarian fantasy where companies and employees have access to the same information and use it to make rational economic decisions. In reality, almost any failing company will use its payroll obligations as a bank of last resort to squeeze out that last chance of turning things around, and there's no contract that would protect employees from that.
"This seems like some kind of weird libertarian fantasy"
It's called the world we live in.
If a company's revenues are in decline, if there have been recent layoffs, well then the writing is on the wall.
A company folding should not come as a surprise to any of the employees unless the are utterly in the dark with respect to product development, revenues etc.
It's not a 'libertarian fantasy' to expect that employees etc. will have some idea of these numbers.
There's not much that can be done about solving the 'insolvency severance' deal. Severance beyond legal requirements is a bonus opportunity, and like all bonuses, it's subject to risk.
Better it be required by law and provided by the government than you hoping you'll get severance and being beholden to a company's "generosity", and the company include the additional tax payments as cost of doing business (same as the other employment taxes they're required to pay).
Severance is never guaranteed though, bankruptcy or otherwise. If a company is going bankrupt, of course they're not going to have the funds to pay severance when closing up shop. Unless I'm misunderstanding the point (and the quotations around generosity were intended to convey that in bankruptcy, that doesn't exist).
Regardless, I suppose the end result should be to make unemployment kick in faster so you don't need an insolvent company to provide a severance they don't have the funds to provide.
So in a world where there's a glut of labor, you're absolutely right. We, however, are not in a glut of labor for software engineers and game designers.
And besides, if you explained to the employer the risks you forsee in joining their company, they will most likely understand that reason for asking for a higher salary than the norm.
There absolutely is far more labor than positions available for game designers. Same for game programmers, many of whom have education and background so specific to games that they are effectively unemployable outside that industry. There are a bunch of schools that train hundreds of students on nothing but how to build high-level game logic in Unity.
Almost everyone directly involved in production of game titles (i.e. not middleware) would be financially much better off taking the skills they already have and working in another industry—e.g. management for game designers, tech for programmers—with the possible exceptions of artists and musicians.
To some extent, you're right. Point taken, there is a glut of game engineers. However, your comment about people being virtually unemployable outside the game industry rings hollow.
In the course of my career, there have been many people from a variety of backgrounds that became full fledged software engineers. One was a truck driver who became a top Java coder at the company I used to work for.
And the game engineer has a step up on that guy, since he actually understands how to code. He just needs to understand the way the web works.
I have a game design degree... And there are waaaaay more of us than there are companies to hire us. I ended working with other things because all game companies I tried wanted to offer minimum wages because there was tons of people trying to get into the industry so no reason to offer more
I’m thinking beyond software engineers. I’m thinking about people who don’t have pricing power for their labor and are not at all in a position to negotiate. They have to rely on government to help them with unequal balance in power when it comes to pricing for their labor.
In the event of a bankruptcy leaving you with unpaid wages, you file an application with the same office that handles unemployment benefits, and they will recompensate you. C-level managers are exempt.