this post was submitted on 17 Feb 2026
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A. Owners aren’t on the hook for shit. This is what limited liability means and what layoffs and bankruptcies are for.
B. Lots of employees do exactly that. See Bob’s Red Mill for instance.
Owners of small businesses usually put in a lot of unpaid time and effort. They often put in their own savings. So they have a lot more to lose than 2 weeks pay. They are also still liable for the legal, financial, and tax handling of the defunct company. There are often lawsuits around companies that fail. Directors can be named personally on the suit and while that can usually be fixed, it takes corporate lawyers to handle and they cost.