Redundancy pay from the dti

js1954

Four of us are due to be made redundant by our company on the 14th June, we were informed around the 6th June, that the company had applied for help with the Redundancy payments to the DTI (National Insurance Fund) as they have cash flow problems, although they are continuing to trade.

We were told we would get the payment around the 14th directly from the DTI, but now we have been informed by our management that the decision from the DTI on whether the company fits the criteria for qualification for these payments has been put off until 21st June.

Can anybody advise of how long they think we will have to wait? Can we claim any compensation for the delay? Has anyone else been in this position? Is it normal that payments are being delayed?

marlot

Really sorry to hear your news.

Unfortunately, unless you find a new job very quickly I have some more bad news. I think you can apply for job seekers allowance immediately after 14 June, but I believe that your DTI payout will be subtracted from the JSA.

mumf

Statutory redundancy is ringfenced, and tax free. NOTICE pay is deductible from benefits if paid by Gvt.
I am going through this now myself.

js1954

The main area of concern is that we were only informed shortly before we left on 14th June that the company have applied to the DTI for the loan of the payments, - now we are past the 21st when we were told by our company that we would have an answer - but still nothing.

My (former) MD hasnt replied to my emails to see if he has got the funding from the DTI sorted - does anyone know if I can approach the DTI to see how things are progessing (phone numbers / addresses etc) as I only have the word of my former MD that all this is happening. I can stand the wait as long as I know something is progressing somewhere.

Thing aren't so bad for some of us as we have secured further employment elsewhere, but it is worrying that a reasonable amount of money (80 years service between us) has still not been paid, and answers are hard to come by

zzzLazyDaisy

Is the company in Administration? If not, your former employer is not being straight with you. The government Redundancy Payments Service does NOT fund employers with cash flow problems but is continuing to trade. It pays out where the employer is insolvent (ie gone bankrupt/in liquidation/in administration).

Some info here

https://www.gov.uk/your-rights-if-your-employer-is-insolvent/claiming-money-owed-to-you

If the employer is not insolvent, you need to make a claim to the employment tribunal. There is a strict 3 month time limit; if your last day of service was 14th June, the cut off date for making a claim is 13th Sept. More importantly, fees are due to be introduced on 29th July, so don't allow your employer to string things out.

It is also worth looking at the fairness (or otherwise) of the decision to make you redundant, and the way in which the consultation process was carried out, as you may also have a claim for unfair dismissal.

To advise you about that we'd need to know when you started working for the company (if you wish to make a claim for unfair dismissal you must have started working for them before 6th April 2012).

Also to claim a redundancy payment you need at least two years' service.

EDIT: Just read that you have 80 yrs service between you, so I am going to assume that you all have more than two yrs service!

js1954

Hi

thanks for the reply

Yes we have approx 24 year, 20 years, 35years and 15 years individually.

I have spoken by email to our former MD today (who is still trading under the same name) and he insists he still talking to the DTI about qualifying for a loan for the redundancy payments due to cash flow problems

Johno100

js1954 wrote: »

Hi

thanks for the reply

Yes we have approx 24 year, 20 years, 35years and 15 years individually.

I have spoken by email to our former MD today (who is still trading under the same name) and he insists he still talking to the DTI about qualifying for a loan for the redundancy payments due to cash flow problems

Believe me there is no such scheme, the Department for Business, Innovation and Skills (it hasn't been the DTI since 2009) is not in the business of giving hand-outs to trading businesses who can't pay redundancy to workers.

As suggested if I was you I should be preparing my Employment Tribunal application ASAP.

zzzLazyDaisy

OP, I suggest that you phone the Redundancy Payments Helpline on 0845 145 0004 and get the information from the horse's mouth.

peachyprice

I was going to ask a question along these lines, OP I hope you don't mind a little hijack here.

If a company can't afford redundancy payments but can just about continue to trade after they've made people redundant where would the redundancy payments come from?

LittleVoice

peachyprice wrote: »

I was going to ask a question along these lines, OP I hope you don't mind a little hijack here.

If a company can't afford redundancy payments but can just about continue to trade after they've made people redundant where would the redundancy payments come from?

I think it would be rather difficult for them to continue to trade when they so clearly would not be solvent if they cannot meet their obligations to their employees.

peachyprice

So they can't do that then, they have to go into administration?

And what if they tried to reduce someone's pay by forcing them into part time hours and that person could not afford to take the pay cut so were therefore forced to resign, can they do that to get out of paying redundancy?