Redundancy pay if shop goes bankrupt!
Discussion
I've been in my current job p/t for 15 years. It's a very small shop with 6 staff and is up for sale at the moment as losing money rapidly.
The owner has had it for 40 years and with Tescos opening very near by, it has finished our trade as we can't compete with their prices.
Although the shop is up for sale there is only so long we can afford to stay open and us staff feel bankruptcy is coming very soon.
So if the shop does go under, how do I/we claim our redundancy?
Obviously they will be bills/rent/debts to be paid so will the staff be put to the bottom of the list?
The owner has had it for 40 years and with Tescos opening very near by, it has finished our trade as we can't compete with their prices.
Although the shop is up for sale there is only so long we can afford to stay open and us staff feel bankruptcy is coming very soon.
So if the shop does go under, how do I/we claim our redundancy?
Obviously they will be bills/rent/debts to be paid so will the staff be put to the bottom of the list?
Is the shop actually going bankrupt?
Just because a business decides to cease trading does not mean it is insolvent and can't pay its statutory debts.
Unpaid wages and redundancy pay are statutory debts in that the business MUST pay these BEFORE it pays other debts - such as money owed to suppliers, HM Revenue and Customs and the proprietors themselves.
Just because a business decides to cease trading does not mean it is insolvent and can't pay its statutory debts.
Unpaid wages and redundancy pay are statutory debts in that the business MUST pay these BEFORE it pays other debts - such as money owed to suppliers, HM Revenue and Customs and the proprietors themselves.
Kudos said:
Loopyleesa said:
No thanks, I don't like the uniform!
I'm sure the owner of your shop who is watching his livelihood going down the pan isn't so keen that you are only interested in lining your pockets than helping him
Eric Mc said:
Is the shop actually going bankrupt?
Just because a business decides to cease trading does not mean it is insolvent and can't pay its statutory debts.
Unpaid wages and redundancy pay are statutory debts in that the business MUST pay these BEFORE it pays other debts - such as money owed to suppliers, HM Revenue and Customs and the proprietors themselves.
I'm sure he is hoping it will sell before going bankrupt.Just because a business decides to cease trading does not mean it is insolvent and can't pay its statutory debts.
Unpaid wages and redundancy pay are statutory debts in that the business MUST pay these BEFORE it pays other debts - such as money owed to suppliers, HM Revenue and Customs and the proprietors themselves.
He has owned the shop for 40 years and has retired already, we are all working together to hope bankruptcy doesn't happen.
We have all taken a reduction in pay to help out.
I am looking for another p/t job and if one comes up that suits then I will take it. My £2000 redundancy isn't that important to me and if it helps the boss/shop out then all the better.
I was purely curious about my topic
Why do you keep mentioning the word "bankrupt"?
Is the shop run through a limited company or as a sole tradership?
If a limited company, a company does not go "bankrupt". If it becomes insolvent (i.e. it can't [pay its debts) it will either -
go into receivership
or
go into administration
or
be liquidated
If the shop is run by the proprietor as a sole trader, it is THE PROPRIETOR as an individual that would go bankrupt, not the shop.
If the shop shuts or even if it doesn't but the owner has to let staff go, then the staff are legally entitled to all back pay and redundancy pay that is due to them. They are preferential creditors and must be looked after first before ANYBODY else is paid.
Is the shop run through a limited company or as a sole tradership?
If a limited company, a company does not go "bankrupt". If it becomes insolvent (i.e. it can't [pay its debts) it will either -
go into receivership
or
go into administration
or
be liquidated
If the shop is run by the proprietor as a sole trader, it is THE PROPRIETOR as an individual that would go bankrupt, not the shop.
If the shop shuts or even if it doesn't but the owner has to let staff go, then the staff are legally entitled to all back pay and redundancy pay that is due to them. They are preferential creditors and must be looked after first before ANYBODY else is paid.
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