Company I work for is going bust...

[Caspar]

I need some advice regarding employment law. I have worked for a company on continuous employment for nearly 3.5 years (5.5 non-continuous). We were told a few weeks back that the company is having financial problems and we advised to seek alternative employment ASAP.

I have received no formal written notice of contract termination or company financial situation.

I have been paid my Sept salary (working on the basis of 2weeks behind and 2 week ahead and paid on the 15th of each month). But I have been told no money is availble for October.

I have been told that the bank are getting involved and are sending the 'Business Support Team' in. Are they the administrators? Also the bank have told the company to close and lock awayt he company cheque book.


The advise I am seeking really is:

1. Are the company legally bound to give me notice, my contract states 3 months.

2. Am I likely to get paid even if the company cheque book is closed, are they legally bound to pay salaries.

3. What government policies are in place to cover me/protect me?

4. I have about £100 in unpaid expenses, how to I get this back?

5. I've been paid upto Thursday, last day in Sept, what should I do on Friday! I can't afford not to work, is there a chance that if I work I'llget paid somehow?


Any advice on the above or anything relevant would be great.


p.s. I've been looking for jobs and have a few good leads

[Richard M]

Quit on Friday and get another job asap!

[Graham M]

Yeah but what about the legalities of his pay?

lots of info available in the link

http://www.emplaw.co.uk/emplaw/emplo...formation.aspx

- sorry to hear of your problem, Caspar, I hope it gets sorted

[Escapee]

Originally Posted by Caspar

I need some advice regarding employment law. I have worked for a company on continuous employment for nearly 3.5 years (5.5 non-continuous). We were told a few weeks back that the company is having financial problems and we advised to seek alternative employment ASAP.

I have received no formal written notice of contract termination or company financial situation.

I have been paid my Sept salary (working on the basis of 2weeks behind and 2 week ahead and paid on the 15th of each month). But I have been told no money is availble for October.

I have been told that the bank are getting involved and are sending the 'Business Support Team' in. Are they the administrators? Also the bank have told the company to close and lock awayt he company cheque book.


The advise I am seeking really is:

1. Are the company legally bound to give me notice, my contract states 3 months.

2. Am I likely to get paid even if the company cheque book is closed, are they legally bound to pay salaries.

3. What government policies are in place to cover me/protect me?

4. I have about £100 in unpaid expenses, how to I get this back?

5. I've been paid upto Thursday, last day in Sept, what should I do on Friday! I can't afford not to work, is there a chance that if I work I'llget paid somehow?


Any advice on the above or anything relevant would be great.


p.s. I've been looking for jobs and have a few good leads

My experience is limited with this, but i did work for a company that went into administration a number of years ago, they came in forst to see if the company was viable to continue trading until they sought a buyer. Fortunately it was part of a larger group and we were making a small profit for the first time in many years. I remember the fuel cards were cancelled for company vehicles and we had trouble with the wages being paid late because the banks put a blanket stop on all transactions across the whole group. I received a letter from the administrators bout claiming any unpaid monies, and the people who were made redundant are able to claim their redundancy pay from the government, unfortunately I think they only got the statuatory state payments.

If you have anything else specific to ask, I may be able to jog the old memory cells.

I think your next move all boils down to a few points.

1) can you walk into another job
2) how much cash would you get if they go bust
3) Is the company likely to be sold as a going concern

I remember them coming around and listing all the assets, I had a big argument and got very aggressive with some administrator idiot who tried to list my compressor as a company asset. He said I couldn't remove it, and I ended up telling him I would like to see him try and stop me!

PS: A few of us removed some expensive test equipment in case we didn't get paid!

[etccarmageddon]

if they cant pay you due to lack of funds they will be in breach of contract and you'll become a creditor like all the other people they owe money to - you'll be in a queue but the inland revenue will come first!

the bottom line is - you dont want to work in a company like this so get interviewing etc right now.

the statutory redundancy can be paid by the goverment, if your company goes tits up - but it will only amount to a few hundred quid. something like £250 for each year you have worked there.

with regards to the upaid expenses - from what other people I know have experienced I think you will never see that money.

what's the name of the company - pm me the details and I'll see what i can find out.

[SMHarman]

Originally Posted by Caspar

I have been told that the bank are getting involved and are sending the 'Business Support Team' in. Are they the administrators? Also the bank have told the company to close and lock awayt he company cheque book.


The advise I am seeking really is:

1. Are the company legally bound to give me notice, my contract states 3 months.

2. Am I likely to get paid even if the company cheque book is closed, are they legally bound to pay salaries.

3. What government policies are in place to cover me/protect me?

4. I have about £100 in unpaid expenses, how to I get this back?

5. I've been paid upto Thursday, last day in Sept, what should I do on Friday! I can't afford not to work, is there a chance that if I work I'llget paid somehow?


Any advice on the above or anything relevant would be great.


p.s. I've been looking for jobs and have a few good leads

Business support team is not the administrators (yet), the banks are the last in line to get their money back in a liquidation (and don't normally get it all), so it is in their interests to see if this is a going concern that needs financial support or worth pulling the plug. You probably have a good idea about this yourself. Are you winning contracts, are you cutting prices, cutting corners etc. Are all ee's busy.

The company is leally liable to pay you your 3 months notice, however if there is no money you will never see it.

Get paid, that depends on the banks. If the directors have been told to lock up the cheque book, the company is probably tecnically insolvent, and trading / making payments puts them at liablity, thus no money no pay.

This could be cashflow, some contracts not paying on time etc, in which case business support teams are good to see.

Govt policies, if they have not been paying your tax and NI then as long as you have your pay slips to prove it was deducted from your pay cheque you can present that to the IR / NI as evidence. You will need this for your tax returns and to ensure your NI stamp is up to date for pension / benefits.

Put in a claim for the expenses, if you do not claim, they will not go on the list of creditors. Don't incur any more expenses, you may well not see them paid, even if it is a corp credit card you are jointly liable for the expense.

Monday, ask what the state of employment is, not turning up though will mean you have terminated your employment and will forefit your 3 m notice claim. If the bank consider it viable, there may well be bonuses for key ees to ensure the company remains viable, it is very easy for this sort of situation to become self fulfilling as the suppliers withdraw credit, staff withdrew labour and as a result customers cannot be serviced.

Lastly good luck and keep those recruitment options open.

[Escapee]

Originally Posted by SMHarman

Get paid, that depends on the banks. If the directors have been told to lock up the cheque book, the company is probably tecnically insolvent, and trading / making payments puts them at liablity, thus no money no pay.

This could be cashflow, some contracts not paying on time etc, in which case business support teams are good to see.

Lastly good luck and keep those recruitment options open.

In my situation, they stopped all transactions but did a U-turn as soon as they realised our part of the group although not worth much were actually turning in a small annual profit. The main group however were in a very bad state and I think Maxwells fraudulant practices have gone down in history.

I think its a good idea to weigh up the situation because every example is different, it turned out OK for us because four managers bought the company for just under a million pounds.
Things only turned sour when they run it without investing any cash and split the company in half to sell part of it to another company for 10 Million pounds

Yes BUY for less than a million keep it ticking over and sell half for 10 million!

They were lucky to find a company with more money than sense to pay 20 times over the odds for it......... Yes our very own ntl!!!!!!!!!!!!

[Caspar]

Thanks for the input

[greencreeper]

I'm with Richard - forget your rights and everything, just get out now before you end up slung out.

[Matt D]

Sorry to hear about your job problems, Cas I hope you find a new one soon

[Caspar]

I'm sure I will and have some hot leads

...my only concern is what are my, and my colleagues', rights and also where my next month's pay is coming from!

[Florence]

Originally Posted by Caspar

I'm sure I will and have some hot leads

...my only concern is what are my, and my colleagues', rights and also where my next month's pay is coming from!

I should ask these questions suppose there is nothing you can take home to cover your wages if they failed to pay you?

should follow the hot leads up very quickly and if offered start immediately.. as for any company thet you do regular payments to contact them and explain but only after you have spoken to your Bank who might help you for a few months.

[bob_a_builder]

sorry to hear about your situation Caspar,

sorry to be selfish, but can we enquire if that has any bearing on the i-web hosting deals some of us round here might have just signed up for or is that er.. seperate

[Caspar]

Originally Posted by bob_a_builder

sorry to hear about your situation Caspar,

sorry to be selfish, but can we enquire if that has any bearing on the i-web hosting deals some of us round here might have just signed up for or is that er.. seperate

No problem in asking

No I'm not talking about I-Web Solutions, I only work for them on a part-time (for free) basis!