Company in administration and i will be made redundant NO CONSULTATION

Leedslad_3

Hi

The firm i work for appointed administrators on Thursday and they immidiatly made 67 people redundant on the spot.

I am currently employed by the administrators to run the company down. All we were told is that we would be kept on in the short term. We have not been given any idea of when we would be made redundant nor have they had any consultation with us about this.

I am as you can proberly understand very confused as to where i and also the other employees stand.

The administrators have not been very helpfull in relation to givig us advice as to where we stand or what we can claim.

Any advice as to where we go from here would be much appriciated.

Best Regards

Pete111

Not sure its much help but an ex colleague of mine had this exact scenario when Enron went down.

She was a UK employee in the UK under uk employment laws but the closure of the company rather than the loss of her job in isolation, meant that to date she has received £32 in compensation for notice/redundancy - She laughs now but did not at the time.

In a nutshell if the company genuinely has no money then they may not be able to pay their normal termination payments - I think I'm right in saying that Creditors come before employees in the pecking order of dividing up any left over cash too I'm afraid.

The adminstrators should ensure you are paid for the work you are currently doing helping them however. Depending on the state of the finances you and the others may also be in line for notice/redundancy but how much may depend on what the adminstrators find is left in the coffers which is probably why they are keeping tight lipped - I very much hope there is enough for you guys and that they can/will update you soon..

Leedslad_3

Thanks for that, I have also been told that the money is guaranteed through the Insolvency fund. But i am not sure if this is just a rumour

Tibbledom

There is protection within certain limits for unpaid wages and redundancy payments.

See directgov info at

http://direct.gov.uk/en/Employment/RedundancyAndLeavingYourJob/DG_10026695

insolvency service info at

http://www.insolvency.gov.uk/

in the section redundancy and insolvency

Hope this helps

Leedslad_3

Yes i will have a look. To be honest i have looked at both these sites it just seems that it is a grey area when it comes to the consultation period.

Tibbledom

I think you are right. The normal consultation procedures (where large numbers of redundancies are involved) are set out here

http://www.berr.gov.uk/whatwedo/employment/employment-legislation/employment-guidance/page13852.html

However this would probably come under the "special circumstances" mentioned. I'm not an expert on this to be honest.

Leedslad_3

Great thanks i will have a look on there,

Having looked on the direct gov website i have found this which is quite interesting but it doesnt say where the money comes from:-

Who will pay you?

The Insolvency Service's Redundancy Payments Offices are responsible for paying the following claims:

• redundancy pay
• wages (including protective awards)
• holiday pay
• notice pay
• basic award for unfair dismissal
• unpaid pension contributions

Tibbledom

It effectively comes out of the national insurance fund if there is no money in the company to pay it. The precise insolvency service link I was trying to post earlier is at:-

http://www.insolvency.gov.uk/guidanceleaflets/redundancypayments/guideforips/guideforips.htm

Leedslad_3

Thank you some bed time reading tonight. Much appriciated,