I have worked for a couple of airlines where they had low time F/Os who were nominally more 'senior' to later entrants who had much more experience. Because there was always a minimum hours requirement for upgrade, the later entrants got the left seat - and hence a better pay packet - first. Enough and instant reward for prior experience, yes? Once that happened, they could never be bypassed as a Captain in that fleet by anyone who had missed out.
However, when it came to bidding for a home base, this was done purely on date of joining, so our Captain who had been promoted earlier could not suddenly decide that he wanted to be a F/O in a more desirable base or go to a lesser paid fleet in a more desirable location as Captain ahead of anyone who was nominally 'senior' and met the experience requirements for that fleet and had bid for that base. Seemed fair enough.
As for those Captains whose airlines go bust, to have any chance of DEC, it's best to find another airline where the average F/O experience is low. Now, if that is not in your home town, tough luck. And if your next benefactor/employer has enough F/Os about ready for command, stiff
old son, go to the back of the line and wait your turn.
Otherwise, go to China where your experience will get you both fame and fortune (cookies). No seniority at all there - for expats anyway.