Company ceased trading but not in receivership

watto59

The company that my wife worked for has ceased trading. They have not gone into liquidation or receivership as yet.
She has been paid wages up to date but now needs to know if she can claim redundancy from the govt.
She has conflicting information.Some say that she can't claim until the company is in receivership/insolvency. Some say that she can claim.
Does anyone have the definitive answer or guidance, please??

markandkate

If the company do not pay her then the only option that she has is to apply to the national Insurance Fund but they only pay out if the company is insolvent.The only way she can get her money if the company are not insolvent ie just stopped trading is to go to an employmnet tribunal and get an award from the tribunal that she is entitled to a redundancy payment.

The next step assuming the redundancy payment is more than £750 is to apply to the court to wind the company up. Once the compnay is wound up ( insolvent ) she can then apply to the fund.

This however is a very time consuming and costly procedure and only worth doing if tere is a group of people who can share the cost and workload. Sadly for most people it just isn't worth it.

She may be able to apply to a tribunal and get hte award and then wait and see what happens. This will not cost her anything and it may be that the company is insolvent by then but if she is only going to be entitled to a few hundred pounds it may not be worth it

watto59

Thanks Markandkate. We are hoping that one of the creditors will call in the receivers but up to now no luck.

markandkate

the only reason a creditor would call in the receivers other thatn the bank or HMRC woul dbe if they thought that there were some assets. As this does not sound like the case I would say it is highly unlikely that anyone else will do this as they will have to pay all hte fees probably for nothing