Do you qualify for insolvent company director's redundancy payments?

For directors to be entitled to redundancy payments, you must have been a director-employee, working under a contract of employment — whether that is written, oral, or implied. The following quick questions will give you a general idea of whether or not you qualify, and whether you would be likely to put forward a successful application for payment

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If "yes" continue to the next question

In order to qualify for a redundancy payment, you need to have worked continuously for the company for at least two consecutive years. If you haven’t got two years' service, you will still be entitled to a paid notice period, along with any unpaid wages and outstanding holidays you are owed. See further information below.

If your answer is "no"

In order to qualify for redundancy pay, you must have given at least two years continuous service to the company. However, if your company liquidates, and the company has been unable to pay you, or your employees, any of the following where it is due, regardless of the length of service or number of hours worked per week, you/they may be able to put forward a claim to the National Insurance Fund for:

• Any unpaid wages (up to a maximum of 8 weeks) you are owed
• Outstanding holiday (up to a maximum of 6 weeks)
• Loss of notice, where owed

If "yes" continue to the next question

Your PAYE history will be a strong indicator of your employment status. It may be the case that not all of your salary has been paid through the company PAYE, however, it is normally a requirement that at least some of your salary has historically been paid through the company PAYE. If you have any queries concerning this, please feel free to contact us and discuss your individual circumstances.

If your answer is "no"

If you have been unable to pay yourself in recent months, this may not preclude you from making a claim, if you can demonstrate that you have historically been entitled to a salary from the company. Usually, this will require at least some of your pay to have been paid through the company PAYE system.

If you have never paid yourself through the company PAYE system, only ever received irregular dividend payments, or no payment at all, it is less likely that you would able to submit a successful claim to the National Insurance Fund. However, if you would like to chat this through with one of our advisors, please feel free to contact us directly for further advice.

  • Redundancy Pay
  • Any outstanding arrears of pay owed
  • Outstanding holiday pay
  • Paid notice period

If your answer is "yes"

It is very likely that you (and your staff) will be able to make a successful claim to the National Insurance Fund for payments due. How much you will be entitled to will depend on your age at the termination of your employment, the length of service you have given the company, and your weekly salary entitlement.

If your answer is "no"

If your company can afford to settle all outstanding employment entitlements prior to closing, it should do so. You will not need or be able to make a claim to the National Insurance Fund. If you are unsure what the company is liable for in terms of employment entitlements prior to closing, you can find further information here. Alternatively, please don’t hesitate to contact one of our advisors and we will be happy to discuss your individual circumstances and clarify any queries with you

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Directors Redundancy — Insolvency

Where the company stands financially, and what monies are owed to whom, will most likely decide if this is the best option for you. If there are monies owed for arrears of pay, outstanding holiday and notice payments due, then this is likely to be the most appropriate route.

More about Directors Liquidation Claims

Process and Costs

We like to keep matters straightforward and simple, read our step by step guide to the process and our costs here.

View the Process and Costs

Liquidating your Business

Liquidation is a formal legal process that must be dealt with by a licensed Insolvency Practitioner. Whether you have already instructed a liquidator, or you are still shopping around, we will be happy to discuss your redundancy entitlements with you.

Find out about Liquidating your Business

Helping director employees get back what they’re due

Redundancy Assist was formed with the sole purpose of helping directors make claims for their redundancy entitlements in the event of insolvency.

Our staff have operated within the insolvency sector for several years and have a deep understanding of its procedures and requirements. Coupled with our strong working relationship with the Redundancy Payments Service, our experience enables us to expertly advise company directors of insolvent companies.

All our case managers hold up to date CIPD qualifications in Employment Law.