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ChatterBank1 min ago
redundancy pay
3 Answers
Hi, I'm asking this for a friend. He is a graphic designer with a company who are making changes and he's expecting to be made redundant as a result. There are a few problems here: he doesn't have a contract although he's been with them for 5 years and also they haven't payed him for the past two months due to "cash flow problems". Can he claim his unpaid wages if he's made redundant and what are his rights? I'm so worried.. Thanks.
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it really will depend on whether or not your friend has been working for the company directly, or whether he has been working as a contractor (self employed or via an agency). Generally speaking though, if they pay his wages he should enjoy the same rights as any other worker - not having a contract shouldn't negate this. If you are over 21 you are entitled to 1 weeks pay for every year of service although if they are going into liquidation it might be difficult. Try looking at www.dti.gov.uk/er or www.acas.org.uk
If your friend is an employee then, whether or not he's been given a piece of paper, he has a contract with the firm. (The law states that he should have been given a written statement of his contract but the absence of a piece of paper doesn't mean the absence of a contract).
It's that contract with the firm which gives him various entitlements. One of these is to receive his wages for the work which he's done. Nothing which happens in the future (such as redundancy) can take away that entitlement to be paid for his services. (The only exception, of course, is that if the firm goes bust and there's no money left to pay him, then he effectively loses his entitlement to payment simply because of the 'blood out of a stone' concept).
With 5 years service, your friend will be entitled to redundancy pay. See here for further information:
http://www.dti.gov.uk/employment/employment-le gislation/employment-guidance/page15686.html
If a firm hasn't been paying its employees, there's probably a very good chance that it's about to 'go under' (and then we return to the 'blood out of a stone' problem). My advice is that your friend should press hard to get whatever payments he can now, before it's too late. If, for example, the firm says that they'll calculate his redundancy pay and then add on his missing wages once they've done that, your friend should make it very clear that this is unacceptable. He should insist on receiving his missing wages straight away. If he can get that money now, at least he'll have something in his pocket if the firm goes bust. If he agrees to wait for a while, he might find that the firm goes bust in the intervening period, leaving him with nothing at all.
Chris
It's that contract with the firm which gives him various entitlements. One of these is to receive his wages for the work which he's done. Nothing which happens in the future (such as redundancy) can take away that entitlement to be paid for his services. (The only exception, of course, is that if the firm goes bust and there's no money left to pay him, then he effectively loses his entitlement to payment simply because of the 'blood out of a stone' concept).
With 5 years service, your friend will be entitled to redundancy pay. See here for further information:
http://www.dti.gov.uk/employment/employment-le gislation/employment-guidance/page15686.html
If a firm hasn't been paying its employees, there's probably a very good chance that it's about to 'go under' (and then we return to the 'blood out of a stone' problem). My advice is that your friend should press hard to get whatever payments he can now, before it's too late. If, for example, the firm says that they'll calculate his redundancy pay and then add on his missing wages once they've done that, your friend should make it very clear that this is unacceptable. He should insist on receiving his missing wages straight away. If he can get that money now, at least he'll have something in his pocket if the firm goes bust. If he agrees to wait for a while, he might find that the firm goes bust in the intervening period, leaving him with nothing at all.
Chris
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