What Happens When Your Employer Is Insolvent?

If the company you work for hits hard financial times, is unable to pay its debts and is legally insolvent, you may be entitled to compensation for lost wages, redundancy and other lost entitlements.

You might also have a claim that your employment should transfer to any purchaser of the business assets.

A check through Companies House will tell you the legal state of a company, but it will be classed as legally insolvent if:

  • It is in administration and an administrator has been appointed.
  • An Official Receiver has been appointed.
  • The company is in liquidation.
  • A winding-up order has been made, or a resolution for voluntary winding-up has been passed.
  • A voluntary arrangement has been approved – under which creditors have entered into an agreement with the company under the supervision of an insolvency practitioner.
  • Possession of the company has been taken by the owners of a charge.

Employees may be able to make a claim for payment of unpaid wages, but office holders – such as company directors – may not qualify.

Lost wages can also include commission, holiday pay and overtime payments that you could have earned.

How we can help

Your rights will vary depending on the situation of the company you worked for, so if you have any concerns or worries, do speak to someone from the employment law team at Else Solicitors to see how we can help you.

An initial consultation is available free and without obligation. To arrange your consultation or for more information, please contact Stephen Stewart on 01283 526200 or email Stephen.Stewart@elselaw.co.uk.

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Your contract of employment is one of the most important documents you will ever sign.

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There are a wide range of rights attaching to payments due from employers in the course of employment, both statutory and contractual.

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Bullying In The Workplace, Discrimination & Harassment

Employees are protected under UK legislation from being discriminated against on the grounds of their race, religion or belief, age, gender, disability or sexual orientation.

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What Happens When Your Employer Is Insolvent?

If the company you work for hits hard financial times, is unable to pay its debts and is legally insolvent, you may be entitled to compensation.

Learn More >

Disciplinary & Grievance Procedure

The Advisory, Conciliation and Arbitration Service (ACAS) has a code of practice for both disciplinary and grievance procedures – but it is not legally-binding, so employers can adopt their own policies on how to handle these matters.

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What Happens When The Company You Work For Is Sold?

If the company you work for is sold, your employment rights should usually be protected under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).

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Steve joined Else after spending over 20 years in law practices in Worcestershire and the West Midlands specialising in dispute resolution particularly High Court litigation.

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Stephen Stewart

Dispute Resolution Solicitor

How can we help?

Get in touch.

Else have a team of experienced employment solicitors, in Burton on Trent, that focus firmly on preventing disputes from occurring.

If you would like more information from our employment solicitors in Burton on Trent please call 01283 526200. Alternatively, you can send us a message and we will get in touch at a time that suits you.