JohnSmith

Not sure if anyone knows the answer to this

But its in relation to my previous question regarding company going into administration

Anyway we all received this email from the Boss today

'Unfortunately guys due to Company X funding cuts, Company X will be unable to pay wages due to lack of funds.

I am looking at putting Company X into administration due to large debts. That means unfortunately you won't get paid through Company X and you will need to claim your wages off the government.

As you know it was my intention to move you into Company Y but I cannot lend you your wage money until tomorrow (once your claim is done I will expect Company Y to be paid back) please make sure you speak to your bank to ensure you dont get charged and cancel any standing orders or dd's until the funds are in - any issues let me know and I will be happy to discuss this matter further

To summarise I will lend you your wages tomorrow from Company Y and you only pay it back when your claims have been paid from government

Thanks for your patience'


So in essence the company hasn't been put into administration but what is that about claiming back from the government

I thought that if a company went into administration then it was tough luck on getting paid?

Company Y is up and running and all customers informed and Company X is still being used and funnelling all new business through to Company Y for invoicing etc. We are all expected to continue working as if nothing has happened. Except Company Y has NO cash at all, no credit lines but at least 300k of orders and cannot at the moment get a factoring agreement

steve ex vauxhall

iTrader: (5)

Print the email, and go and see a solicitor.
sounds very fraudulent to me, most solicitor's will give you half hour for free.
cover your own ****!

Scooby Soon!

Government will cover redundancy if company is bankrupt. i don't see exactly what you are worried about your boss seems to be very accommodating by lending you wages he could tell you to whistle for them!

RobsyUK

iTrader: (2)

Don't companies have to have a pot of cash to pay the wages as part of their total debt?

JohnSmith

It's not redundancy as no one has been made redundant and everyone is supposedly now working for Company Y

The above is the only written communication that has been sent regarding anything to do with the company or administration

ScoobySoon the only reason the Boss is very accomodating is that we are all needed in Company Y to fulfill all the orders from Company X

If he didn't pay us today we would have downed tools and walked away and the Company Y would fold before it even started

Its just the whole 'I will lend you your wages as a loan until you get your money back from the government' bit I don't understand

pimmo2000

iTrader: (6)

sounds a bit gay

fitzscoob

No, if a company doesnt have the money to pay the wages its tough luck, its also very hard to find staff willing to work for free.

If you're being moved across from one company to the other one would assume you have been TUPE'd

PaulC72

sounds very dodgy to me, how will you get your wages from the government if you have not had any break in employment, not been released or redundant?

For him to lend you your wages to pay back sounds like he is pulling a fast one as he has your services and will get away without paying you for the last week or so even if you get something from the government I doubt it will be what you expect or should be paid.

I feel sorry for the supplier he has ripped off and he is stringing along as he will be taking them for lots more before he folds company X, I bet he will use company Y to do the work but the invoices wont get paid as they will be in company X but the end customer will pay company Y.

fitzscoob

Its quite a bit of an assumption that he or they are about to sting suppliers, its not always the case.

JohnSmith

Oh it is trust me he is

JohnSmith

To me what it looks like he is doing is pulling a fast one

I had a quick google and it seems you can (in certain circumstances) claim back some / part / all of your unpaid wage from an insolvent Company

My guess is (as he knows or has written just about every single trick in the book) that he has decided to pay us all from Company Y knowing that we can potentially claim and when we get the money from the claim we give it to him

the money comes back from any funds from Company X (that money is the offer he has made to buy Company X back, and just so happens to be the same as a months wage bill)

I asked about expenses yesterday fully expecting him to say no touch luck as that was the old company, however he said yes still claim them back (I think he said this as he took money off another member of staff for a company loan LOL)

fitzscoob

Is this a limited company and is this guy the only director?

When you were told about moving to this different company has he moved all the staff across using the TUPE system?

Devildog

Mate

When an employer becomes formally insolvent, subject to one exception, the RPO (Redundancy Payment Office) will pay, up to the statutory limits, what's due to the employees for arrears of wages, holiday pay, redundancy (where applicable) and there is also a compensatory payment for failing to receive statutory notice.

THe RPO then submits a claim for the amounts paid out in the insolvency

The one exception is where the business and assets or substantially the whole of the business and assets are sold/transferred to another entity. In that case you have what is called a TUPE* transfer and the current case law for administrations requires the purchaser/transferee to be liable for the employee arrears, and for continuity of employment for redundancy and notice purposes.

Its different for liquidations where not all of the liability will transfer across. So it depends as much on the type of insolvency as it does the actual course of events.

What is being suggested - you claim and then repay the loan with what you receive is basically fair enough, but it fails to recognise the probability that the RPO will reject the claims as the liability has TUPE'd across.

*Transfer of Undertakings & Protection of Employment Regulations

hodgy0_2

I doubt this guy would know what TUPE means, let alone apply it, with all the rights and protection it give the current employees

I would not be surprised if he re-employed them on lower wages and worse conditions tbh

JohnSmith

Cheers mate

the only thing that has officially been said regarding any of this is what I posted in the first post

No TUPE has been mentioned, some things have been said in passing briefly, other things via phone but almost nothing certainly to me at least

I'm sure he is just trying to get some of his money back

He does know about TUPE, he also knows just about every trick in the book and he knows most things legally because he does it to everyone else

eg, sales guy left, so he is still suing him a year on for something or other, another guy left he is refusing to pay his sick pay because he didnt go through the correct procedure

He has been threatend with stat demands and then gets in touch with suppliers knowing that if he makes an offer to pay arrears monthly the supplier will agree, then he makes a small card payment to them over the phone, then defaults on the first agreed installment then gets the stat demand

He knows this gives him an extra week or 2 to find the money to pay the supplier before the stat demand runs its 21 days course

steve ex vauxhall

iTrader: (5)

lol
only said to cover his **** incase anything goes wrong, if they all agree to what the director is saying, then they are all part of it,

Didnt say anything about playing with ****.......

JohnSmith

How do you mean if 'they all agree to what the director is saying, then they are all part of it'

Trust me yesterday was a lot of swearing, cursing threats of walking out as it was not the email we wanted to read

steve ex vauxhall

iTrader: (5)

I wasnt there mate so not got the faintest idea whats going on.
If you had all agreed to go down that route, then you could have been classed as being part of the situation, thats all i meant.
i didnt mean that you agreed with the situation.
You need expert advice from a solicitor mate, not a bloody car forum

JohnSmith

LOL

We got an email whilst we were working on a customer site that said exactly what was said in my first post

No one has agreed to anything other than we want our wages, and not one person agrees with what the Director is doing but we all have mortgages to pay etc

fivetide

iTrader: (1)

Ok so you know he's a ratbag and hi suppliers won't get paid.

what's stopping you and a few other of the lads, taking up his offer (you won't get the cash back from RPO by the sound of it so he won't be able to force you to pay it back), then walking away and having a chat with his clients?

Think Jerry Maguire, get some calls in, get the suppliers on side and make sure the customers know you could deliver.

Clean up.

5t.

JohnSmith

I've been busy this evening

Suppliers is difficult though but there is a way around that for the moment

Customers are the hardest part, but then if they were easy we wouldn't be in this mess LOL

JohnSmith

It would seem that we are not in administration but notice of administration which gives a 10 day period, we are now on the 2nd ten day period and still trading and still buying from suppliers and setting up new suppliers and still no cash

new orders going through to Company Y and Company X is being bought back and will be the parent company apparently