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Ben Jones
Ben Jones, UK Lawyer
Category: Employment Law
Satisfied Customers: 49819
Experience:  Qualified Employment Solicitor - Please start your question with 'For Ben Jones'
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My employer has gone into liquidation I have been sent home

Customer Question

My employer has gone into liquidation
I have been sent home with no paid notice
I have been offered some work, will it affect my notice(which the govt might pay?) & will it affect my redundancy payment ?
The employer has insufficient funds to pay notice or redundancy
Submitted: 3 years ago.
Category: Employment Law
Expert:  Ben Jones replied 3 years ago.

Ben Jones :

Hello, my name is Ben and it is my pleasure to assist you with your question today. Who is the work with, is it a completely different employer? Are tey taking over the existing company?

JACUSTOMER-0psh61pz- : It might be with a company that is owned by the current owner, but is seperate
JACUSTOMER-0psh61pz- : Fellow employees have been told they can do no work for anyone for at least 4 weeks
Ben Jones :

Hi, sorry I lost my connection for a short while. There is no law that states you cannot get a new job as soon as your employer has become insolvent and gone into liquidation or administration. If they have gone insolvent and failed to pay you for what you are due in the circumstances then you are entirely free to seek alternative work straight away – no one can expect an employee to stay out of work for no reason when they are not being paid anything due to their employer’s insolvency. So you are perfectly free to seek work straight away to ensure you continue earning money as any ‘normal’ person would.

The main issue in the circumstances would be if you were being offered work with either an associated employer or with a business that takes over the business as a going concern. In these circumstances it could be argued that your employment had actually continued without you being made redundant and that you would not be entitled to redundancy pay, although you would still be able to recover ay pay due to you from the time you worked there.

JACUSTOMER-0psh61pz- : Thank you
JACUSTOMER-0psh61pz- : Thank you. So if I am offered work as a self employed contractor by my old boss for another company that has been in existence for some time & does the same work, it could be tricky. It is also likely that he would wish to novate some of the liquidated company's projects, which could also be awkward? Someone has also said that we might get our notice paid by the government & that might also be compromised by working too soon?
Ben Jones :

If you are going to work as self employed that would not be considered continuous employment because you would be changing employment statuses - had you continued as an employee then it could be an issue but if your employment as an employee terminates now as a result of the liquidation an you are then employed as a contractor, it would be two different types of employment and each would be treated separately and not covered by the above rules. The issue with the notice is again one that would only really exist if you had continued as an employee because there would have been no dismissal and no notice period would have been due. But switching from employee to self employed there would have been a termination and you should still be paid the notice period regardless of when you start the new job

Ben Jones :

Please let me know if this has answered your original question or if you need me to clarify anything else for you in relation to this? Thanks

Expert:  Ben Jones replied 3 years ago.
Hello Adam, please let me know if I have answered your original question or if you need me to clarify anything else for you in relation to this? Thank you