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Ben Jones
Ben Jones, UK Lawyer
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Experience:  Qualified Solicitor
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Im a self employed and the company that I worked for has gone

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I'm a self employed and the company that I worked for has gone into liquidation, but they owe me 10k for 3 month of my work. Please advise how can I claim the money back?

Ben Jones :

Hello, my name is XXXXX XXXXX it is my pleasure to assist you with your question today.Ok thank you leave it with me I need to look up a few things and then get my advice ready.I will post back on here when done there is no need to wait and you will receive an email when I have responded.

Many thanks for your patience. There will be certain issues with recovering the money you are owed in this case. As you are self employed you will not be covered by the National Insurance Fund which would cover employees’ wages in the event their employer goes insolvent. Also as this was a limited company it is its own legal entity and will be solely responsible for its debts, meaning you may only pursue it, rather than the people behind it, such as the directors and shareholders, who will have no personal liability for the company debts.

If the company has gone into liquidation, it has become insolvent and it means that it is unable to pay its debts. You are a creditor of the company and as such will now join a list of all other creditors who are owed money, such as clients, suppliers, employees, banks, etc.

In the first instance you need to contact the liquidators of the company to ensure that they are aware of the money you are owed. Their job is to try and realise all the assets of the company and then pay out all the creditors in a strict order. Secured creditors will have priority over unsecured ones and as you are an unsecured creditor it does unfortunately mean that you are further down the list for payments. Those above you will need to be paid out in full before the liquidators can then move on to you and pay you out. That creates obvious difficulties because it is clear that the company does not have much money to pay its debts and most of the time it is an unfortunate fact that company creditors either walk away with nothing or with very little from what they are owed (e.g. a few pence to every £1 they are owed).

So apart from contacting the liquidators and registering your debt with them, there is little that you can do as the company is now in their hands and they have a duty to realise the company’s assets and pay out all the creditors so if that is possible you will automatically hear from them.

I hope this has answered your query. Please take a second to leave a positive rating, or if you need me to clarify anything before you go - please get back to me and I will assist further as best as I can. Thank you and feel free to bookmark my profile for future help:
Customer: replied 4 years ago.

Hi Ben,


Thanks for your reply. It's very frustrating knowing that I might not get my money back. However I was just wondering whether my case could be treated as an employee due to the fact that I worked full time for the company since last May, the company is my sole source of income and they have provided my with all the work equipments, tools and materials, I also completed the internal time sheets like any other permanent employees.


Please advise if I could approach this like I'm a employee of the company?





Hello Haiyun,

Whether you are an employee or not is a factual issue that would be considered by taking into account your working arrangements, rather than what you were labelled as.

Following years of case law, a number of established factors have generally been accepted as a reasonably accurate way of establishing whether someone is an employee or self employed. The courts would still use some of these to get an overall picture of the employment relationship and determine the person's employment status.

The tests that are most commonly used can be found here:

By following the link and answering the questions you may get a good idea of what your employment status is, although it is worth noting that these are still only an indication and only a court can provide a definitive answer. They are nevertheless useful to use in negotiations with the employer/liquidators.

The issue there is that the company may still not have enough money to satisfy its debt to you and you could then be prompted to take the matter further, such as to the National Insurance Fund and claim part of what you were owed from the Government. The following debts, if owed to employees by an insolvent employer, can be recovered from the NIF:
• Up to 8 weeks' arrears of pay (up to the current maximum statutory limit on a week's pay) less basic rate tax and NI contributions.
• Up to 6 weeks' holiday pay (up to the current maximum statutory limit on a week's pay) which accrued in the 12 month period ending on the date of the insolvency, less basic rate tax and NI contributions.
• Statutory notice pay (up to the current maximum statutory limit on a week's pay) less basic rate tax.
• Statutory redundancy payment less any amount already paid by the employer

Any claims in excess of the above limits should be claimed from the insolvent employer in the usual way, such as through the insolvency practitioner or through court.

To be able to claim from the NIF, the following conditions must be met:
• Only employees can claim, therefore the self-employed, agency workers, etc are not covered
• The employer must have been made officially insolvent
• The employee’s employment must have been terminated

Assuming the above criteria have been met, the procedure for claiming requires the application to be made to the Redundancy Payment Office responsible for the employer’s area, by using form RP1. To get a copy of the form and for further details, you can contact the Redundancy Payments Helpline on 0845(NNN) NNN-NNNN

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