Not been paid - 2 months now!
Discussion
Hi Everyone.
I've seen some really good advice on here with regards to workplace matters and unfortunately, the time has come where I need to seek some myself.
I work for a small Design Engineering consultancy (approximately 4 other engineers and myself) and we report directly to the MD (Business owner)
The company has ran into huge financial difficulty, mainly due to cashflow. My MD often lands us with projects that are too big for us really (in my opinion). This time it really has gone that way. We are currently mid way through the build for 2 big projects based in China that really should have been undertaken by the likes of Rolls Royce or GE aviation. The available cash has now dried up both for paying staff and suppliers and payment on the projects isn't released until they hit Chinese soil.
The MD has apologised on multiple occasions and assured us that additional funding is on the way, to please just sit tight...but first it was only going to be 1 month, now it's rolled onto 2 months.
If the worst should happen and the company goes pop. Where do I stand in retrieving money that is owed to me? (limited company by the way)
Thanks in advance - Please only sensible answers. I often joke around and join in with the banter on this forum but I have a mortgage and a young family, so my sense of humour is somewhat lacking on this occasion.
PS - Obviously CV is up to date and circulating around but landing a new job won't recover what's owed to me.
I've seen some really good advice on here with regards to workplace matters and unfortunately, the time has come where I need to seek some myself.
I work for a small Design Engineering consultancy (approximately 4 other engineers and myself) and we report directly to the MD (Business owner)
The company has ran into huge financial difficulty, mainly due to cashflow. My MD often lands us with projects that are too big for us really (in my opinion). This time it really has gone that way. We are currently mid way through the build for 2 big projects based in China that really should have been undertaken by the likes of Rolls Royce or GE aviation. The available cash has now dried up both for paying staff and suppliers and payment on the projects isn't released until they hit Chinese soil.
The MD has apologised on multiple occasions and assured us that additional funding is on the way, to please just sit tight...but first it was only going to be 1 month, now it's rolled onto 2 months.
If the worst should happen and the company goes pop. Where do I stand in retrieving money that is owed to me? (limited company by the way)
Thanks in advance - Please only sensible answers. I often joke around and join in with the banter on this forum but I have a mortgage and a young family, so my sense of humour is somewhat lacking on this occasion.
PS - Obviously CV is up to date and circulating around but landing a new job won't recover what's owed to me.
Thats crap to hear especially at the start of the year.
Depending on the size of your client and how they go pop
Then your limited company will join the list of people they owe money to and you'll receive pence in the pound of what you're owed.
If you havent already, stop doing any billable hours for them until the matter is resolved. No sense in making that hole any bigger than it is.
Take the opportunity to spend some more time with your family - it'll help reduce the stress as well.
Hope it works out.
Depending on the size of your client and how they go pop
Then your limited company will join the list of people they owe money to and you'll receive pence in the pound of what you're owed.
If you havent already, stop doing any billable hours for them until the matter is resolved. No sense in making that hole any bigger than it is.
Take the opportunity to spend some more time with your family - it'll help reduce the stress as well.
Hope it works out.
I read it as though the OP is employed PAYE and the company that employs him isn't paying him.
Difficult situation. If they go pop, you could end up getting nothing.
If you refuse to work - it still won't get you paid.
I would sit down with your boss and explain that you have bills to pay which do not wait for his cashflow issues to be resolved. Ask if he can forward a payment to you, if necessary out of his pocket - it's his business after all, not yours.
If he can't or refuses then you have a decision to make - resign and go and do something else which will get you paid (bearing in mind there'll be a lead time to set that up) or wait it out and hope the money comes through.
Difficult situation. If they go pop, you could end up getting nothing.
If you refuse to work - it still won't get you paid.
I would sit down with your boss and explain that you have bills to pay which do not wait for his cashflow issues to be resolved. Ask if he can forward a payment to you, if necessary out of his pocket - it's his business after all, not yours.
If he can't or refuses then you have a decision to make - resign and go and do something else which will get you paid (bearing in mind there'll be a lead time to set that up) or wait it out and hope the money comes through.
If they do not have money and it is a limited company you may well find yourself a long way down the list of creditors in terms of recovering any wages.
Getting out is the best option and hoping that you get paid. Or ask the boss for half the money today half next month, just to get something.
Technically, non-payment of wages is a fundamental breach of contract which would enable you to leave immediately and sue them for the monies - but if they do not have it....
Getting out is the best option and hoping that you get paid. Or ask the boss for half the money today half next month, just to get something.
Technically, non-payment of wages is a fundamental breach of contract which would enable you to leave immediately and sue them for the monies - but if they do not have it....
I was unfortunately in the same position as you be it many years ago. As soon as I threatened to leave out came the cheque book and a cheque was written for my salary and subsequently bounced. I ended up leaving a month down. If the company goes bust you like everyone else will be left in the hands of the liquidators and that depends what assets are left and their value. The last thing any business owner wants is not to pay their staff so I bet there are suppliers who have been waiting even longer.
Not good news but I think you need to find alternative employment asap.
Not good news but I think you need to find alternative employment asap.
Agree with the sentiment above
Tell your boss you’re not happy and need paid, asap, any way he can. Just be open and honest. He has to know how difficult it is for his team, if you all quit he’s f
ked. Apologies are worth nothing.
If he owes you, say £10k, ask for it all and when he says he can’t tell him how much you need to get caught up on your living expenses, even if that’s just 2-3k or whatever, anything, get him to transfer cash to you immediately or walk out. He’s in breach of contract if he’s not paying you what he’s obliged to.
I’m a contractor and if a client doesn’t pay me on time they slip down the priority list, the rate goes up and, eventually, I’ll stop doing work for them. Principle is exactly the same.
Tell your boss you’re not happy and need paid, asap, any way he can. Just be open and honest. He has to know how difficult it is for his team, if you all quit he’s f
ked. Apologies are worth nothing.If he owes you, say £10k, ask for it all and when he says he can’t tell him how much you need to get caught up on your living expenses, even if that’s just 2-3k or whatever, anything, get him to transfer cash to you immediately or walk out. He’s in breach of contract if he’s not paying you what he’s obliged to.
I’m a contractor and if a client doesn’t pay me on time they slip down the priority list, the rate goes up and, eventually, I’ll stop doing work for them. Principle is exactly the same.
Edited by Lefty on Thursday 4th January 13:21
It depends.
Do you trust that the company will pull through? And can you afford to?
Many years ago I was in a similar situation with a building company that was struggling. I blocked access to some equipment that they needed until I got paid some cash that I was fairly desperate for myself, then left. They folded shortly afterwards (they still would have even if I'd played along )
A few years ago my son was working for a start up which was struggling to get ahead cash flow wise. The CEO didn't take a salary for almost a year and asked my son if he could miss a few wages . He was young with no ties and had confidence in the CEO so he agreed. The business took off and my son is now a shareholder in a very successful business. His gamble paid off very well.
Only you will know whether it is a risk worth taking.
Do you trust that the company will pull through? And can you afford to?
Many years ago I was in a similar situation with a building company that was struggling. I blocked access to some equipment that they needed until I got paid some cash that I was fairly desperate for myself, then left. They folded shortly afterwards (they still would have even if I'd played along )
A few years ago my son was working for a start up which was struggling to get ahead cash flow wise. The CEO didn't take a salary for almost a year and asked my son if he could miss a few wages . He was young with no ties and had confidence in the CEO so he agreed. The business took off and my son is now a shareholder in a very successful business. His gamble paid off very well.
Only you will know whether it is a risk worth taking.
jackofall84 said:
If the worst should happen and the company goes pop. Where do I stand in retrieving money that is owed to me? (limited company by the way)
In the case of insolvency, how much you get will depend upon the value of any liquidated assets, monies owed to HMRC and the bank. You and your colleagues will receive a share of anything left after this. The Government may also pay you for unspent holidays and other accrued benefits that you have been denied. That will need to be applied for. In both cases, it will be several months before you know if you're going to get anything and actually get the money.There will be many posting suggesting that you bail now, that the MD's a berk and all that.....But.....Keep in mind that unless you are highly fortunate, it may take two to three months to find another job and another month after that before you start getting paid again, in which time, the problem with your current employer may get resolved and your colleagues receive what owed to them plus a bit extra for the trouble.
I sympathise with you. I also have a certain sympathy for the MD. As a business owner, it's exceptionally tempting to pursue the big contracts at the expense of working out the fundamentals. What he's failed to do here is understand the pre-financing exposure. Providing the client is sound and the overall project balances out financially, then the money will come in so you would do well to consider whether the company is otherwise viable, whether this is a one-off, whether it can weather the storm... or not. Only you can determine that.
HTH and Good Luck
StevieBee said:
In the case of insolvency, how much you get will depend upon the value of any liquidated assets, monies owed to HMRC and the bank. You and your colleagues will receive a share of anything left after this. The Government may also pay you for unspent holidays and other accrued benefits that you have been denied. That will need to be applied for. In both cases, it will be several months before you know if you're going to get anything and actually get the money.
There will be many posting suggesting that you bail now, that the MD's a berk and all that.....But.....Keep in mind that unless you are highly fortunate, it may take two to three months to find another job and another month after that before you start getting paid again, in which time, the problem with your current employer may get resolved and your colleagues receive what owed to them plus a bit extra for the trouble.
I sympathise with you. I also have a certain sympathy for the MD. As a business owner, it's exceptionally tempting to pursue the big contracts at the expense of working out the fundamentals. What he's failed to do here is understand the pre-financing exposure. Providing the client is sound and the overall project balances out financially, then the money will come in so you would do well to consider whether the company is otherwise viable, whether this is a one-off, whether it can weather the storm... or not. Only you can determine that.
HTH and Good Luck
Thanks SB,
Yes, I believe sitting tight and hoping the funding comes in is my best option at present. Throwing my toys out the pram and storming out isn't going to resolve anything financially for me overnight anyway. I meant to mention, I have been with this company for 9 years and know the MD very well. This has been the first time that this has happened so I'm somewhat inclined to believe him when he tells me he's able to secure funding and this has been a terrible oversight on his part, but it will be temporary.
coincidentally, the MD informed me over lunch that 1/2 the funding applied for and required has been secured. He's now following up on several other leads for the remainder.
This has left a sour taste in my mouth though, so I will be continuing to seek other employment options. It would just be nice to have a bit of breathing room.
There will be many posting suggesting that you bail now, that the MD's a berk and all that.....But.....Keep in mind that unless you are highly fortunate, it may take two to three months to find another job and another month after that before you start getting paid again, in which time, the problem with your current employer may get resolved and your colleagues receive what owed to them plus a bit extra for the trouble.
I sympathise with you. I also have a certain sympathy for the MD. As a business owner, it's exceptionally tempting to pursue the big contracts at the expense of working out the fundamentals. What he's failed to do here is understand the pre-financing exposure. Providing the client is sound and the overall project balances out financially, then the money will come in so you would do well to consider whether the company is otherwise viable, whether this is a one-off, whether it can weather the storm... or not. Only you can determine that.
HTH and Good Luck
Thanks SB,
Yes, I believe sitting tight and hoping the funding comes in is my best option at present. Throwing my toys out the pram and storming out isn't going to resolve anything financially for me overnight anyway. I meant to mention, I have been with this company for 9 years and know the MD very well. This has been the first time that this has happened so I'm somewhat inclined to believe him when he tells me he's able to secure funding and this has been a terrible oversight on his part, but it will be temporary.
coincidentally, the MD informed me over lunch that 1/2 the funding applied for and required has been secured. He's now following up on several other leads for the remainder.
This has left a sour taste in my mouth though, so I will be continuing to seek other employment options. It would just be nice to have a bit of breathing room.
Two months without pay as an employee is totally unacceptable.
Firstly I'd be heavily on to the new job search. Might as well get a head start on the 4 other guys in the business who may well be your competition shortly.
Secondly I'd want a really good understanding from the owner as to the true state of affairs. If it really is a case of delivering the project and the money rolls in fine. Keep on working whilst job searching. It might just all work out but I'd also want to broker a deal with the boss that there is going to be some additional bonus for your inconvenience.
By the sound of it he needs you right now as much if not more than you need him so now's the time to strike a deal.
Treating his staff in this way needs to hurt him even if it does all work out in the end.
Firstly I'd be heavily on to the new job search. Might as well get a head start on the 4 other guys in the business who may well be your competition shortly.
Secondly I'd want a really good understanding from the owner as to the true state of affairs. If it really is a case of delivering the project and the money rolls in fine. Keep on working whilst job searching. It might just all work out but I'd also want to broker a deal with the boss that there is going to be some additional bonus for your inconvenience.
By the sound of it he needs you right now as much if not more than you need him so now's the time to strike a deal.
Treating his staff in this way needs to hurt him even if it does all work out in the end.
jackofall84 said:
Hi Everyone.
I've seen some really good advice on here with regards to workplace matters and unfortunately, the time has come where I need to seek some myself.
I work for a small Design Engineering consultancy (approximately 4 other engineers and myself) and we report directly to the MD (Business owner)
The company has ran into huge financial difficulty, mainly due to cashflow. My MD often lands us with projects that are too big for us really (in my opinion). This time it really has gone that way. We are currently mid way through the build for 2 big projects based in China that really should have been undertaken by the likes of Rolls Royce or GE aviation. The available cash has now dried up both for paying staff and suppliers and payment on the projects isn't released until they hit Chinese soil.
The MD has apologised on multiple occasions and assured us that additional funding is on the way, to please just sit tight...but first it was only going to be 1 month, now it's rolled onto 2 months.
If the worst should happen and the company goes pop. Where do I stand in retrieving money that is owed to me? (limited company by the way)
Thanks in advance - Please only sensible answers. I often joke around and join in with the banter on this forum but I have a mortgage and a young family, so my sense of humour is somewhat lacking on this occasion.
PS - Obviously CV is up to date and circulating around but landing a new job won't recover what's owed to me.
Sorry to hear about your situation. If you PM me, i can help with some information.I've seen some really good advice on here with regards to workplace matters and unfortunately, the time has come where I need to seek some myself.
I work for a small Design Engineering consultancy (approximately 4 other engineers and myself) and we report directly to the MD (Business owner)
The company has ran into huge financial difficulty, mainly due to cashflow. My MD often lands us with projects that are too big for us really (in my opinion). This time it really has gone that way. We are currently mid way through the build for 2 big projects based in China that really should have been undertaken by the likes of Rolls Royce or GE aviation. The available cash has now dried up both for paying staff and suppliers and payment on the projects isn't released until they hit Chinese soil.
The MD has apologised on multiple occasions and assured us that additional funding is on the way, to please just sit tight...but first it was only going to be 1 month, now it's rolled onto 2 months.
If the worst should happen and the company goes pop. Where do I stand in retrieving money that is owed to me? (limited company by the way)
Thanks in advance - Please only sensible answers. I often joke around and join in with the banter on this forum but I have a mortgage and a young family, so my sense of humour is somewhat lacking on this occasion.
PS - Obviously CV is up to date and circulating around but landing a new job won't recover what's owed to me.
Olivera said:
CheesecakeRunner said:
Walk. Now. Before they owe you any more.
This. The fact the MD can't fund wages out of his own pocket for a month or so indicates he is personally skint, or not willing to stump up the cash. Leave now.I think the conversation went along the lines of 'stick around, finish the project we/I will pull though when I get paid'
It changed very quickly to 'sorry I can't pay you - be thankful you still have a job' once he got paid.
Different times (90's) but I'd still never get drawn in again.
Octoposse said:
I’d assume that rent, bank fees, energy bills, insurance, business rates, etc, etc, are also in arrears.
Can’t be long before those creditors force the issue.
I'd also assume that if they are no longer paying staff there will be a whole host of other entities that haven't been paid.Can’t be long before those creditors force the issue.
From your perspective it could be worth looking into things like student loans and pensions to ensure any contributions previously deducted from your pay have actually been paid to the appropriate places.
Op, how close are you to the MD? Does your position afford you some insight into the accounts like other liabilities etc?
Can the MD be persuaded to look at factoring? If getting the work in, but the invoices can’t be settled till the end of contract he maybe in a good position to consider this? I assume he’s spoken to his bank too? With contracts signed surely it’s an avenue?
I think as others have said there has to be a line drawn at some point and only you will know (as much as it’ll be painful) where that line sits.
Can the MD be persuaded to look at factoring? If getting the work in, but the invoices can’t be settled till the end of contract he maybe in a good position to consider this? I assume he’s spoken to his bank too? With contracts signed surely it’s an avenue?
I think as others have said there has to be a line drawn at some point and only you will know (as much as it’ll be painful) where that line sits.
Olivera said:
CheesecakeRunner said:
Walk. Now. Before they owe you any more.
This. The fact the MD can't fund wages out of his own pocket for a month or so indicates he is personally skint, or not willing to stump up the cash. Leave now.t. Business is business and loyalty rarely counts for anything when it comes to money. All you need to think about is that you are working for nothing as of 2 months ago. The company is toast. As mentioned by others, the debt list to suppliers, business rates, utilities, tax will already stretch down the street if it's got to the point where he can't pay the staff. That's the clear writing on the wall that the receivers are going to arrive on site any day, send you all home and lock the gates behind you. I doubt you will ever see your money owed I'm afraid (if ltd co as your OP suggests).Gassing Station | Jobs & Employment Matters | Top of Page | What's New | My Stuff