Employers are refusing to pay their staff

The_Truth_Enforcer

Hi,

My employers turned to us and stated that they were making us redundant which will be taking into effect immediately. The entire company has now ceased trading. Approximately a loss of 60 jobs.

Once more, they also said that they are not in a position to pay us as the bank are refusing to release their money as their accounts are under investigation. They did say that it could take between 2 weeks and 9 months for the investigation to have an outcome but will pay us as soon as they are able to.

Saying this, it has been circulated that the General Manager threatened a staff member for going to the media.

Contact has been attempted but the entire bulding has been closed down and I cannot seem to get hold of any of the senior management. It is rumoured that the owner has fled the country which seems likely since his house is all closed down with the use of shutters.

Within hours of leaving, other employees did state that Police and Bayliffs were in attendance at the premises.

I have consulted Citizens Advice Bureau and they have told us to approach the small claims court and I have drafted in a solicitor but they have said that they can assist with the procedures but are unable to attend court (as the solicitor is working for free.)

This could be a costly process and so looking into the chances of getting owed money. As I have not been there for 2 years, I am not entitled to any statutory redundancy.

If the company is completely ceased (it is neither bankrupt nor insolvent), is it possible to seize personal assets of the owner as I have seen the cars he has (albeit hired) and they include Lambourghinis, Porsches (owned), Bentlyes, Ferraris etc. Also, his house has been put on sale to ... Can all this be seized and sold to compensate for loss of earning for employees?

Its all a mess and any assistance would be grateful.

Chartered_Eng

The_Truth_Enforcer wrote: »

If the company is completely ceased (it is neither bankrupt nor insolvent), is it possible to seize personal assets of the owner as I have seen the cars he has (albeit hired) and they include Lambourghinis, Porsches (owned), Bentlyes, Ferraris etc. Also, his house has been put on sale to ... Can all this be seized and sold to compensate for loss of earning for employees?

Its all a mess and any assistance would be grateful.

You can't simply seize assets to pay off outstanding debts. If the company has been wound up, and I doubt it, then you would have to lodge a claim with the owner. If the company is in the process in being forcibly wound up then you should register a claim with the administrators as you will be a creditor. It all gets rather complex so legal advice is vital. Do a search on the Company's House web site for the company status and for a small fee you can get details of all the directors. Also keep an eye on the classified ads in local papers as companies being would up have to be announced with a call for any outstanding debtors to place a claim on the company assets. As an ex-employee you should get notification automatically from the administrator.

This all sounds like an iffy outfit where the owners took the money and ran.

The_Truth_Enforcer

Chartered_Eng wrote: »

You can't simply seize assets to pay off outstanding debts. If the company has been wound up, and I doubt it, then you would have to lodge a claim with the owner. If the company is in the process in being forcibly wound up then you should register a claim with the administrators as you will be a creditor. It all gets rather complex so legal advice is vital. Do a search on the Company's House web site for the company status and for a small fee you can get details of all the directors. Also keep an eye on the classified ads in local papers as companies being would up have to be announced with a call for any outstanding debtors to place a claim on the company assets. As an ex-employee you should get notification automatically from the administrator.

This all sounds like an iffy outfit where the owners took the money and ran.

Thank you for your reply. I have worked for the owner on and off for the past several years so it has alll come out of nowhere.

I am awaiting a response from the Solicitors but a little worried that nothing will be able to be done as the owner could have done a runner. Say worse case scenario, the owner disappears ... Does that mean there is nothing to be done?

diable

The_Truth_Enforcer wrote: »

Say worse case scenario, the owner disappears ... Does that mean there is nothing to be done?

Most probably.

The_Truth_Enforcer

diable wrote: »

Most probably.

Most probably yes to getting money or most probably not?

Chartered_Eng

The_Truth_Enforcer wrote: »

I am awaiting a response from the Solicitors but a little worried that nothing will be able to be done as the owner could have done a runner. Say worse case scenario, the owner disappears ... Does that mean there is nothing to be done?

If the owner has left the country with assets left behind and the company owning money to employees and other creditors then you are looking at a mess. It comes down to company law and you become a creditor along with the rest of the queue but there is a preference order for creditors. Also there is government safety net for wages but it does have a cap. Read this web page for some background info http://www.companyrescue.co.uk/company-rescue/guides/redundant-employee

It’s good you have got in touch with a solicitor. Don’t grab any assets because if the company is in liquidation the administrator with come after you for that asset possibly with the police in tow. The assets belong to the company and the administrators job is to recover all assets and distribute them to the debtors according to company law.

ceridwen

My first thought would be "...and just who pays me income to live on whilst this mess is sorted out?".

So - on OP's behalf - I wonder if anyone knows the position re claiming Income Support whilst this situation is resolved or he gets another job?

I know I would personally be looking to go and "sign on" instantly to keep some income flowing in whilst this was sorted out, whilst (if need be) being aware that the DWP would be likely to reclaim benefit later for any period that I found I had been subsequently able to get some salary for from the administrators...

In your position O.P. - I would be providing myself with proof the firm had suddenly ceased to exist to show the DWP as proof that I was entitled to claim benefit. Maybe:
- witness statements from other employees (ie I think you all need to get together on this point)
- photographs of closed-up firms offices and closed-up house
- whatever other proof you can get that the firm is suddenly kaput.

Don't forget - even if a firm goes into administration, the redundancy money is still due - but its the Government that will then pay it. You will need to make a claim for this from the Government.

I suggest you get together and have a meeting with your colleagues about this and co-ordinate your approach/support each other re benefit/redundancy money/getting salary owed if possible from this firm. If you are all in a Union then that is your first port of call. If not - hmmm....well..in that case organise a meeting of employees affected yourself (rooms above "local" type pubs are usually available at a very cheap rate to hire for meetings).

Good luck.

The_Truth_Enforcer

Many thanks for your links and advice. I am lucky enough to have got myself another job that starts in a weeks time so by the time I apply for income support etc, I will be well into my next job.

Also, I have spoken to the relevant people regarding the Governments redundancy scheme but this is only available to those of whom have worked for the company for 2+ years of which I have not nor has many others.

The owner is nowhere to be seen and the General Manager was approached of which he stated that he no longer has any responsibility with the company.

The phone is constantly engaged and despite a letter being sent to us stating we can contact them via the phone or email, there has been no reply to my email.

Chartered_Eng

The_Truth_Enforcer wrote: »

Many thanks for your links and advice. I am lucky enough to have got myself another job that starts in a weeks time so by the time I apply for income support etc, I will be well into my next job.

Well, that is some welcome good news. Better luck in the new job.

The_Truth_Enforcer wrote: »

The owner is nowhere to be seen and the General Manager was approached of which he stated that he no longer has any responsibility with the company.

The phone is constantly engaged and despite a letter being sent to us stating we can contact them via the phone or email, there has been no reply to my email.

This does not surprise me at all. Dangle some spurious contact details to fob people off knowing all along it's a dead end. Apart from keeping an eye on the goings on via the press and solicitor you may have to resign yourself to writing this one off to experience. For all you know there may have been fraud involved and then the mess gets even deeper.

hcb42

Yes, it is possible to sign on, and also claim statutory redundancy from the payment office (separate claim)

If more notice is owed then you have to make a claim with the administrators and queue up with the rest, back of the queue unfortunately. However worth doing, if you are owed say 3 month notice by contract, as they may pay xp in the £, and so anything is better than nothing. Probably not worth it for short notice period though, once the payment has been received by the redundancy payment office.

(I got the the gov redundancy, having worked at a company for barely 3 months, so surprised it is 2 years now..)

wacko911

No doubt this will get shot down in flames, but if my employer told me go home we have no money to pay you, I would taking what I was owed with me. (laptop, lab equiptment anything else not bolted down and worth a few quid) flog it on ebay and send back any extra money. (ie not profit from my actions, just cover my loss)

Yes im sure it's totally illegal, but I would have my day in court and highly doubt a jury of 12 of my peers would find me 'guilty'.