Insolvency Redundancy

[Click2Post.co.uk]

Hi Folks,

My business (ltd) of 15 years is unfortunately about to enter insolvency.

I got a pleasant surprise to hear my directors redundancy package will look something like below as a fully salaried director and employee for the last 2 years (no dividends, although the first 13 years were low salary/high dividend when the business was profit making)

Salary £538/week x 13 years = £6,994
Unpaid holidays (how do they prove this?) 15 days = £1,614
13 weeks notice = £6,994
Total package = 15,602.00

Does this seem correct?

Also, the Insolvency Service won't pay the notice pay until after 13 weeks, and will deduct any pay from a new job!
So would I be better having 13 weeks off working life after the insolvency of the company?
I don't see the point in diving straight in to a new job if my salary will be covered for 13 weeks due to the notice pay?
I have savings to carry me over until that payment would land.

After working 60 hours a week for 15 years I could really do with 3 months off!

Any advice appreciated, thank you.

 

[Frank Wessely]

Hi Folks,

My business (ltd) of 15 years is unfortunately about to enter insolvency.

I got a pleasant surprise to hear my directors redundancy package will look something like below as a fully salaried director and employee for the last 2 years (no dividends, although the first 13 years were low salary/high dividend when the business was profit making)

Salary £538/week x 13 years = £6,994
Unpaid holidays (how do they prove this?) 15 days = £1,614
13 weeks notice = £6,994
Total package = 15,602.00

Does this seem correct?

Also, the Insolvency Service won't pay the notice pay until after 13 weeks, and will deduct any pay from a new job!
So would I be better having 13 weeks off working life after the insolvency of the company?
I don't see the point in diving straight in to a new job if my salary will be covered for 13 weeks due to the notice pay?
I have savings to carry me over until that payment would land.

After working 60 hours a week for 15 years I could really do with 3 months off!

Any advice appreciated, thank you.

Hi Click2Post.co.uk

In order to check the figures etc I will need to know your age, as that is relevant to redundancy calculations. If you prefer you can send this to me in a direct message or by email.

Thanks.

 

[Click2Post.co.uk]

Hi Click2Post.co.uk

In order to check the figures etc I will need to know your age, as that is relevant to redundancy calculations. If you prefer you can send this to me in a direct message or by email.

Thanks.

Hi Frank, thanks for writing back. I'm 38 years old

 

[Frank Wessely]

Hi Frank, thanks for writing back. I'm 38 years old

Hi Click2Post

Taking the points in turn at face value:-

Salary - I assume this is your redundancy pay, not arrears of salary. (If it is salary then let me know.) Not sure why it is 13 weeks when you have worked for 15 years. 15 years = 15 weeks which gives you £8070.

Accrued Holiday Pay - that appears correct. The Redundancy Payments Service will verify every aspect of your length of service and claims. Your contract of employment would state the holiday entitlement. They might also check the company books and payroll records for all staff claiming.

Pay in lieu of Notice - You will be under a duty to mitigate this element by looking for new employment and/or claiming whatever state benefits you might be entitled to. If you don't claim then the RPS may deduct what you would be entitled to. The point is that at the end of 13 weeks you would be in the same financial position as if you had worked the notice period - you are not meant to make a profit!

There may also be other areas where you might be able to claim; it all depends on your contract of employment.

Is the Official Receiver handling the liquidation?

Hope that this helps.

​

 

[MBE2017]

Coming back to the question of a new job, I would start looking, but simply state you need to give1-2 or 3 months notice based on when an offer comes in.

A bit late to start looking in three months only to find few are recruiting at Xmas.

 

[Lisa Thomas]

I can highly recommend these people to help you with submitting your claim, if needed:

UKELC - Helping Companies with Insolvency

Assisting Insolvency Practitioners with the post insolvency redundancy claims process

ukelc.co.uk