Redundancy and then Insolvency

uzuria

Hi Guys

My dad was told he was being made redundant in June and his last day was on 29 July. He was supposed to receive his wages today but didn't, and upon phoning the office found that no one had been paid and there is a big chance the company is now insolvent and going into liquidation.

My dad is now afraid he wont receive his wages and redundancy which totals to over £6000. Can this happen if he was made redundant and left before the company went into insolvency? Is there anything he can get from the government if he does lose out on his payments?

Sorry if there are similar threads like this. I had a look but couldn't see a situation where the person has been made redundant but the company goes into insolvency before they receive their redundancy pay. Thanks for any advice you can provide!

SarEl

You need to contact the administrators. The first creditors to be paid will be the staff. If there isn't enough money to do so then they will issue you with a form to claim from the government scheme - although this is capped at £400 per week so if he was due more than that he won't get the total amount. It won't be an overnight solution either as it takes some time to sort out.

Stubod

Hi Sorry to hear of your dads situation, have just been there myself.
As per above, it is safe to assume that there probably will not be enough money to pay out full redundancy, so the state will help subject to how long he worked there, and how old he is.

If you have been there for more than 2 years you get 1 weeks pay for every year worked. This is capped at £400. But if over 41 (I think), you get £600.

ie if 55 and worked there for 5 years you should get

5 * £600 = £3000.

The maximum number of years is 20.

Mine came tghrough in about 6 weeks, and it is tax free.

You should also get "pay in lieu", max 12 weeks, again capped at £400 max. This is taxed, and they will take JSA out of it even if you don't claim it. This money only comes available at the end of the entitilement period. ie if you worked there for 5 years, then you should get it just after the 5 weeks....

Stu

uzuria

Thanks very much to both of you. I'm sure my dad will be glad to hear that even in the bad situation, not all is lost.