Employed by previous employers

Lancalot

Hi

My company are going into voluntary liquidation and I have to claim my redundancy from the government. They are starting a new company under a new name and have asked if I would work for them how would I fair with regards to redundancy I am claiming and would I have to pay it back from the previous employment I am a bit confused.

Thanks

CityLite

Lancalot wrote: »

Hi

My company are going into voluntary liquidation and I have to claim my redundancy from the government. They are starting a new company under a new name and have asked if I would work for them how would I fair with regards to redundancy I am claiming and would I have to pay it back from the previous employment I am a bit confused.

Thanks

First a bit of background...

There are 2 types of voluntary liquidation.

1. Members voluntary liquidation. This is where the shareholders elect to wind up the company safe in the knowledge that they have sufficient assets to pay all the creditors.
- In this case your employer will pay you your redundancy pay (as you are one of the creditors)

2. Creditor's voluntary redundancy. This is where the company/employer cannot pay it's debts and involves it creditors (of which you are one) in winding it up.
Be aware that all the companies assets will be sold (i.e. liquidated) and the proceeds will be distributed to creditors, and as you are one of the creditors, you should expect to receive your fair share in such liquidation process.

Remember, if creditors have been knocked by this failure of your employer, only the crazy would extend credit to them again if they were to start up again under a new company running essentially the same unprofitable business.
Furthermore, the employer will have none of the existing assets it currently has to run the business, from desks & chairs, to machinery, tools, computers, etc.

Furthermore, the directors of a company that has not maintained proper accounting records and/or continues to trade into a position that they are unable to pay their debts, can be reported as 'unfit', and may be disqualified for up to 15 years from being a director (including forming, marketing or running another company)

If you are entitled to any redundancy payment from the government due to the failure of your employer, you will not be expected to pay it back later.

TripleH

It sounds like a "Phoenix company" situation. The old company has been ditched (to get rid of a significant debt/s or onerous contract) and the assets bought by a new start up instigated by the existing directors.

Were the company slow at paying you in the past / do you trust the directors?