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James Mather
James Mather,
Category: Law
Satisfied Customers: 22629
Experience:  Senior Partner at Berkson Wallace
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Can Receivers of a Company in Receiveership use money taken

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Can Receivers of a Company in Receiveership use money taken fron employees wages by the CSA for the benefit of the employees children be used instead for the benefit of the Company's general creditors
Can we have background please?
Customer: replied 5 years ago.

A company went into receivership after paying holiday pay to an employee whohad been 'laid off' for the past three months. The company took a CSA paynent from the employees holiday pay before going into receivership. The money is said to being held by the Receivers and will not be paid to the CSA for the benfit of the employees children. In effect the creditors would be benefiting from money which I would have thought should be sent to the CSA as it no longer should be regarded an asset of the company.

So it was taken from wages but never paid over?

How much is it?

Customer: replied 5 years ago.

Yes. I understand that it is about £300. Date for payment to CSA is at month end but have been told that the company will not be passing it over to the CSA.





Thank you. I am of the opinion that they are not allowed to do this. It is either
unlawful deduction from wages or breach of trust.

They deduct the money from wages as a result of a court order (and that is
quite legal). The money is then held on trust for the benefit of the recipient
who is the child's parent.



What they are actually done is taking the money from wages and kept it!
They have not deducted it in accordance with the court order and passed it to
the child's parent.



This is a matter that will either have to go to Small Claims Court to sue
the liquidators for the money or, refer it to HMRC as unlawful deduction from
wages.



There is no easy way of beating the liquidators into submission although a
solicitor's letter, strongly worded, might wake them up to the fact that they
should not be doing this.



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