Company in administration

KWhite444

Hi
the company I have worked for has gone into administration, so all staff have had to reapply for furlough. However, after 3 weeks have still no payment or clear communication when we will receive it but are expected to go back to work full time this week to liquidise the stock. What are my rights? 

poppy12345

KWhite444 said:

Hi
, so all staff have had to reapply for furlough

An employee can't apply for furlough, only an employer can do this.

KWhite444

Sorry that wasn’t what I meant, all staff have had to reapply as we couldn’t be furloughed under our original employer. The administrators  have reapplied for us but we still haven’t received it for March 

KWhite444

apologies not March, May. 

Thrugelmir

You need to ask the administrators what the position is. You will be paid for whatever hours you work, plus receive payment for any holiday , notice, redundancy etc. 

Galloglass

The administrators  have reapplied for us but we still haven’t received it for March 

If you know who the administrators are, then contact them. Administrators are usually professionals who carry a lot of insurance should things go wrong. They will be in the process of working out who is owed what so it may take some time. Get onto them and then apply for Universal Credit if you are new to benefits or use a benefits checker if you already get Tax credits.

Don't go without money

Thrugelmir

Galloglass said:

The administrators  have reapplied for us but we still haven’t received it for March 

Administrators are usually professionals who carry a lot of insurance should things go wrong. 

Administrators are licenced insolvency practitioners that are required by law to act in a prescribed manner. That includes a duty of care towards the employees. 

Jeremy535897

The administrators' first duty is to the creditors. As part of that duty, they may decide it is better to keep the company going until a buyer can be found, so effectively they take over the company's responsibilities to its employees.

Galloglass

Jeremy535897 said:

The administrators' first duty is to the creditors. As part of that duty, they may decide it is better to keep the company going until a buyer can be found, so effectively they take over the company's responsibilities to its employees.

Employees who are owed wages are creditors too. 

Jeremy535897

Galloglass said:

Jeremy535897 said:

The administrators' first duty is to the creditors. As part of that duty, they may decide it is better to keep the company going until a buyer can be found, so effectively they take over the company's responsibilities to its employees.

Employees who are owed wages are creditors too. 

Yes, but in the first instance they are owed a duty as creditors rather than employees.

Galloglass

I suspect this issue will come up a lot in the next few months or so. The question for employees (of companies in Administration) are how long should they stick it out? As I understand the IP side of it, only £800 of unpaid wages are covered as a creditor, so it begs the question how long should an employee stick with a company in Administration?

If the key staff were to leave after the £800 limit is reached, then there may not be a business to sell. Assets yes but not necessarily a business. So an IP would have to make a quick judgement on who to keep paying and who to let go and if there is a business going forward. I suppose that is what pre-packs are all about. 

On the employee side it will pay to get an idea from the Administrator very early on about individual circumstances and for the employee to make a quick decision, if they can.