Not allowed to claim unpaid wages after redundancy

JacksonM

Hello, I have recently been made redundant - my employer has gone into liquidation. I worked right up until the end and the company owes me approximately six weeks wages. I had no idea the company was going to be wound up - it happened very suddenly.
I filled in an RP1 and it's going through the government redundancy service but I had a letter today stating that I could not claim my wages owed as the time to claim had passed because without informing the staff, the company had a CVA in 2013 and that means that is where they are taking date of the the insolvency of the company from so I cannot claim any backdated wages. I had no idea (none of us did) that the company had even applied for a Company Voluntary Arrangement or, CVA. The director and his management told us nothing about it. No changes to hours or wages were made, everything carried on as normal. I was told today that it was done as TUPE.
How can it be that now they've just gone into liquidation I am not able to claim for my last wages? I cannot find any record online or at companies house that the company went insolvent in 2013 so is a CVA the same as insolvency?
I hope this isn't too garbled! Trying to understand how it is possible to get ripped off like this in this day and age!
Thank you in advance for any help.

Johno100

To answer your last question first, a CVA should most definitely show on the Company's record at Companies House.

As to your entitlement to arrears of wages and any holiday pay, have a read of this case from 2010 that is very similar to your circumstances.

https://lawblacks.wordpress.com/2013/06/18/hard-cases-and-bad-law-insolvency-and-employment-debts/

I can't find any evidence that this decision has been successfully appealed or that the law has been amended, so you may well be out of luck. If that is the case then your only other option is to submit an unsecured claim in the Liquidation proceedings in the probably vain hope you will receive a dividend payment of Xp in the £ at sometime in the future.

JacksonM

You are correct, the CVA does show up on the records but I didn't know that it can be used as the official start date for a future insolvency. That 2010 case is similar and it's becoming apparent that we were caught out and there is nothing we can do about it but I appreciate your advice and will try your suggestion of submitting an unsecured claim, nothing to lose so worth a try.
Many thanks.

DandelionPatrol

https://en.wikipedia.org/wiki/Trading_while_insolvent

wikipedia is not authoritative on law, but it indicates that there should have been a creditors meeting. So staff are creditors, I would have thought and for the CVA to be binding, surely staff should have been notified of the CVA???

p00hsticks

DandelionPatrol wrote: »

https://en.wikipedia.org/wiki/Trading_while_insolvent

wikipedia is not authoritative on law, but it indicates that there should have been a creditors meeting. So staff are creditors, I would have thought and for the CVA to be binding, surely staff should have been notified of the CVA???

From the sound of it, the company was continuing to pay normal wages etc at the time of the CVA. Presumably if the staff were actually getting paid, then they weren't owed anything at the time and so weren't creditors....

DandelionPatrol

p00hsticks wrote: »

From the sound of it, the company was continuing to pay normal wages etc at the time of the CVA. Presumably if the staff were actually getting paid, then they weren't owed anything at the time and so weren't creditors....

.... so why are their later claims now prejudiced by the earlier CVA??? Hmm.

Either someone is reading the legislation wrongly or there is a whacking great defect in the legislation

sangie595

DandelionPatrol wrote: »

.... so why are their later claims now prejudiced by the earlier CVA??? Hmm.

Either someone is reading the legislation wrongly or there is a whacking great defect in the legislation

It depends what you call a defect - it was deliberately written this way. It's not at all uncommon for employees to end up losing out because of a CVA, and nobody is misreading the rules.

Johno100

sangie595 wrote: »

It depends what you call a defect - it was deliberately written this way. It's not at all uncommon for employees to end up losing out because of a CVA, and nobody is misreading the rules.

Or was it? Sometimes when legislation is drafted all the possible permutations are not considered. This can lead to gaps (lacuna is the Latin term for it meaning an empty space or cavity) which can result in the sort of unfairness highlighted by the OP.

sangie595

Johno100 wrote: »

Or was it? Sometimes when legislation is drafted all the possible permutations are not considered. This can lead to gaps (lacuna is the Latin term for it meaning an empty space or cavity) which can result in the sort of unfairness highlighted by the OP.

No gaps. CVA's are a legal instrument for companies to attempt to trade themselves out of debt, and write off future liabilities in a trade against current ones.. They specifically limit liabilities in regard of the workforce, passing on liability to the RPS, which in itself is a limited liability.