Question 1

What happens if your employer goes insolvent and you are owed money?

Accepted Answer

You become a **creditor** — and the practical answer is that some of what you are owed is payable by a **government scheme** rather than depending on whether there is money left in the business, which is the part most people do not know.

**What happens first.** An insolvency practitioner is appointed — as administrator, liquidator or receiver — and takes over. They may continue trading and sell the business, in which case **employment may transfer** and your job continues; or they may make redundancies immediately.

**What you can claim from the National Insurance Fund**, through the Insolvency Service, if you were an employee and your employer is formally insolvent:

**Redundancy pay**, at the statutory rate.

**Arrears of pay**, up to a limited number of weeks and subject to a weekly cap.

**Holiday pay**, accrued and untaken, similarly capped.

**Statutory notice pay**, claimed separately and after the notice period has passed.

**Basic award** for unfair dismissal, in some circumstances.

**The limits matter.** Each element is subject to the **statutory weekly maximum**, so higher earners recover considerably less than they are owed — and anything above the caps, plus contractual entitlements beyond statutory minimums, becomes a claim in the insolvency.

**Where you rank as a creditor.** Employees are **preferential creditors** for certain amounts, ranking ahead of floating charge holders and unsecured creditors — which is better than most creditors and still behind secured lenders and the practitioner's own fees. **Anything above the preferential limits is unsecured**, and unsecured creditors frequently receive little or nothing.

**Pension contributions.** Unpaid employer contributions may be claimable, and the **Pension Protection Fund** covers defined benefit schemes where the employer fails, at a reduced level of benefit.

**What to do:**

**Get the case reference** from the insolvency practitioner, which you need to claim.

**Claim promptly** through the official service, and note the time limits.

**Keep your contract, payslips and any correspondence.**

**Register as a creditor** for amounts above the scheme limits.

**Get advice** if a TUPE transfer is involved, since the position differs.

General information, not legal advice.

Question 2

What are your rights to sick pay?

Accepted Answer

Statutory Sick Pay is a legal minimum, paid by your employer, not a benefit from the state — and it is considerably less than most people assume, which is why the difference between statutory and

Question 3

What happens at a redundancy consultation?

Accepted Answer

A process an employer must follow before dismissing for redundancy — and consultation must be genuine and happen while proposals are still capable of being influenced, which is the requirement most

Question 4

What is TUPE and what happens when your employer is taken over?

Accepted Answer

TUPE — the Transfer of Undertakings (Protection of Employment) Regulations — protects employees when the business they work for changes hands. Its central effect is that your employment transfers

Question 5

How is statutory redundancy pay calculated?

Accepted Answer

By a formula combining age, length of service and weekly pay — and the figure is frequently much lower than people expect, because each of the three inputs is capped or weighted. Who qualifies.

Question 6

What is the difference between redundancy and dismissal?

Accepted Answer

Redundancy is a dismissal for a specific reason: the job is no longer needed. Dismissal generally refers to termination for a reason relating to you — conduct, capability, or another substantial

Question 7

How does an employment tribunal claim work?

Accepted Answer

A specialist tribunal hearing claims about employment rights — less formal than a court, with its own procedure, and governed by very short time limits that end more claims than any argument about

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