What are my options

debtfreedave

I work for a small company, under 20 employees, and its struggling and getting smaller. I've been there for over 10 years and I'm one of the longest serving employees there so would get a decent redundancy payout should it come to that.

Here's my problem. The company is clearly struggling, half the time I have literally nothing to do where a couple of years ago there weren't enough hours in the day.

Last Autumn an informal chat took place in our office between some of the senior staff, myself included, and the owner. He confirmed we were not doing well and suggest we could probably make it through to December (2014) and that would be it.

There was no further mention until Spring this year when I was called into a meeting and told by the owner the company was being sold and my role would be transferred to the purchasing company based in a different city. This applied to around a third of the staff, with another third (the ones who had been there a while) advised to start looking for another job and the final third told nothing. It was all to be completed by June.

Again nothing happened and no further mention until a couple of months ago when I was called to another meeting and told the company would be sold and my role would be transferred to the purchasing company based in a different city. I queried if this would actually happen due to the past events and said I would prefer redundancy. I was told notice would be given to everyone at the end of October with the move being completed over Xmas (i.e.: I would finish for Xmas at my current location and start after Xmas at my new location).

Notice was never given to anyone and nothing has yet happened.

Then earlier this week some of the staff received an email from the owner saying the company would be downsizing after Xmas and that we would be going onto reduced hours. Although their is no allowance for this in my current contract. The email said there would be a meeting about it today, that hasn't happened and as far as I can tell nobody has heard anything further.

It seems to me he wants to closedown but wants those who would be due a decent redundancy payment to leave before he does it.

Can he act in such a manner? What are my rights here?

sangie595

You are probably right - but until something actually happens it is impossible to tell you what your rights are. You have the same job on the same hours on the same pay - until the employer says that is not the case, nobody can really help or advise you - there are too many possible scenarios.

debtfreedave

sangie595 wrote: »

You are probably right - but until something actually happens it is impossible to tell you what your rights are. You have the same job on the same hours on the same pay - until the employer says that is not the case, nobody can really help or advise you - there are too many possible scenarios.

Thanks Sangie. So in essence an employer can keep telling you you'll be out of a job in 4-6 weeks indefinitely but never actually do anything.

That's a shame as in means everyone in that position is stuck in limbo with a constant fear of losing their job at any minute.

Takeaway_Addict

debtfreedave wrote: »

Thanks Sangie. So in essence an employer can keep telling you you'll be out of a job in 4-6 weeks indefinitely but never actually do anything.

That's a shame as in means everyone in that position is stuck in limbo with a constant fear of losing their job at any minute.

If the company is struggling and there is no money how will he pay you the redundancy?

Are you looking for other jobs?

debtfreedave

Takeaway_Addict wrote: »

If the company is struggling and there is no money how will he pay you the redundancy?

The company has a lot less work than it did and in all honesty my role is no longer needed. However it is making enough for the owner to pay himself £5K a month and a 5 figure dividend twice a year. Additional I am aware he has taken a lot (circa £100K) out of the company in loans to himself and family members which haven't had a penny paid back.

Saying that the workforce has shrunk around 75% and nothing is being done to bring new customers in so its only going in one direction.

Its pretty clear he wants to close the company, he just wants to do it without paying anyone redundancy.

Takeaway_Addict wrote: »

Are you looking for other jobs?

Yes I am.

sangie595

Takeaway_Addict wrote: »

If the company is struggling and there is no money how will he pay you the redundancy?

Are you looking for other jobs?

He is no doubt hanging on until there is nothing left to bleed out of the company and then will leave the employees with the statutory redundancy scheme - which unless they are due enhanced redundancy, probably isn't a big problem for them as they will get what they are owed - eventually. Hopefully. Of course, if there is no insolvency and it all goes **** over ***, then they may get nothing.

I'd agree that another job is all around the best option for anyone sitting in this position. It may let the employer off a hook, but being out of employment is cold comfort to keep an employer on the hook - maybe.

getmore4less

Read up the rules on short time and lay offs, there are potential redundancy terms if they cut the hours over 50%.

If there is a business what about a workers buyout if the boss wants out.

debtfreedave

An update. On the last day of November everyone was given notice that we will be made redundant on Dec 31st.

The redundancy letters (there has been no meetings, we haven't been spoken to, we were posted letters to our homes) say we are entitled to statutory redundancy.

Now here's the where the confusion comes in. The finance department have said there isn't enough money to pay redundancy. In my mind that means the company is insolvent and an administrator should come in. Then ultimately if the money isn't there a claim can be made from the government. But we have been told the company isn't being closed. It will continue with only the boss, basically a vehicle for him to continue contracting with some of our clients.

What happens here? Is redundancy not like any other debt and if it can't be paid the company is bust?

sangie595

Yes and no. Drat. I hate this advice.

You are only entitled to claim from the RPS if the company is declared insolvent - what you think should happen is of no importance. If the employer refuses to make the company insolvent you have the right to force insolvency. Which will certainly cost you more money to do than you are owed. And then some. And your inability to force the company to become bankrupt is exactly what the employer is betting on. You would be idiots to do it. And the boss knows that.

Poppy9

8. Redundancy pay
Employees you make redundant might be entitled to redundancy pay - this is called a ‘statutory redundancy payment’.

To be eligible, an individual must:

be an employee working under a contract of employment
have at least 2 years’ continuous service
have been dismissed, laid off or put on short-time working - those who opted for early retirement don’t qualify
You must make the payment when you dismiss the employee, or soon after.

A redundant employee also has the right to a written statement setting out the amount of redundancy payment and how you worked it out.

Statutory redundancy pay rates
These are based on an employee’s age and length of employment and are counted back from the date of dismissal.

Employees get:

1.5 weeks’ pay for each year of employment after their 41st birthday
a week’s pay for each year of employment after their 22nd birthday
half a week’s pay for each year of employment up to their 22nd birthday
Length of service is capped at 20 years and weekly pay is capped at £475. The maximum amount of statutory redundancy pay is £14,250.

You can give your staff extra redundancy pay if you want to, or have a qualifying period of less than 2 years.

You can use the redundancy pay calculator to work out payments.

If you don’t pay
If you fail to pay redundancy pay or if an employee disagrees with the amount, they have 6 months from the date their employment ended to make a claim for payment to an employment tribunal.

If an employee doesn’t claim in time, a tribunal still has 6 months to decide whether or not they should get a payment.

Details of costs here on going to Industrial Tribunal

If a group of you go together to the IT it will be more cost effective.

I assume you are not in a union?

debtfreedave

sangie595 wrote: »

If the employer refuses to make the company insolvent you have the right to force insolvency. Which will certainly cost you more money to do than you are owed. And then some. And your inability to force the company to become bankrupt is exactly what the employer is betting on. You would be idiots to do it. And the boss knows that.

Thanks, altough not what I was wanting to hear!


Seems a huge loophole to have a legal entitlement to the payment but no realistic method of getting the money if they just say they won't pay it.