A moral dilema

climbingoutoftheabyss

I am currently employed in a private limited company, I am not a director or shareholder.

Due to poor financial management by the Directors of the business and a decline in work from one key account the Company is insolvent, although currently still trading:

1. None of our supplier base has been paid for several months and the company is 'on-stop' with the vast majority, some of the debts go back to May 2015.

2. Three members of staff (including me) are owed salary arrears from August 2014. July salary was late (but paid), August was part-paid (late), September salary was late (but eventually paid). While the amount is fairly small there are also outstanding expenses going back to July 2015.

3. The Company has just received significant payments from clients, these came in to the Company account at the beginning and middle of this week. None of the suppliers or outstanding salaries (see 2) have been paid.

It is my belief (but I have no firm evidence) that the Directors are planning insolvency. It is clear to me that they were waiting for the client payments before making their move. Since the payments came in to the business no outstanding salaries have been paid, no suppliers have been paid.

None of the client remittances remain in the bank, there is not enough cash to cover salary (nor are there remittances due) let alone the very significant amount due to creditors.

I'm aware that if the business is made insolvent then I, and other staff members, can claim our statutory redundancy. However, I am extremely angry that the 2 Directors of this business are continuing to trade whilst it is obvious they are insolvent.

Frankly, we were expecting insolvency as soon as the last client remittance was received on Wednesday 21st October, but it seems the charade is going on a little longer.

I am angry that we are being expected to come in to work on a pretence (they are not coming in to the office themselves) and as a 'cover-up'. I feel used and I am absolutely livid that they are taking us for fools.

Of course, if this pantomime does not end shortly, we will get to the end of the month when salary is due and, of course, they have absolutely no intention of paying salary.

Is there anything I can do, other than sit it out, remain silent and claim my statutory redundancy?

jobbingmusician

I do know that if Directors knowingly trade whilst insolvent, they are potentially personally liable for the debts of the company. I don't know who to report this to, though. Maybe a phone call to companies house? I would start with a search of their website.

In haste!

climbingoutoftheabyss

Thanks, the same thought came to me. I've checked it out and I'm calling the Insolvency Office to make a formal complaint.

Tiddlywinks

Report the directors:

https://www.gov.uk/complain-about-a-limited-company