JohnSmith

Been in a meeting of sorts today

Boss came in to 'explain' a few things about newco and us being in administration

We are NOT being TUPED across to newco so have to have 'new contracts'

It is NOT a pre pack administration just normal administration

We officially go into administration on Tuesday as his second 10 day 'protections umbrella' runs out

He has already agreed the purchase price of Oldco and to pay back over 6 months and this has been agreed by the IP with no other bidders

He has only agreed to buy the assets, name good will etc, but NOT Work In Progress, staff and debt (apart from 1 supplier)

Although he has actually transferred all the WIP orders over to newco and is still maxing out all the suppliers ready to start newco with lots of stock from oldco

He did also say he has planned this since back in August and the timing of it all as he knew back then the oldco would fail and back in March last year setup newco and that newco is due to file its accounts at the end of March and will have a 300k order book with no outgoings for stock etc so will look very impressive to creditors etc

He also said he has setup another newco about 6 months ago too to have additional supply lines (different director but another employee)


Now I have a question as I have now setup my own Company so I can carry out work at the customer (my long standing friend) who he severely shafted for 80 grand of orders that they have paid for

My current (soon to be dissolved) contract states clearly I musn't solicit business from customers etc for at least 12 months and also I must devote my whole time to the company and not for anyone else etc

Now if I do this once the company goes into adminstration, would he have any legal claim against me from oldco ? can I legally go after all his customers if I don't sign a contract with newco?

I may have to sign a contract though to ensure I get paid at the end of March from newco

Also the accountants have kicked off a bit today saying that cannot process payroll as we don't have P45's so i'm not sure where that will leave everyone ?

The Zohan

My current (soon to be dissolved) contract states clearly I musn't solicit business from customers etc for at least 12 months and also I must devote my whole time to the company and not for anyone else etc

Now if I do this once the company goes into adminstration, would he have any legal claim against me from oldco ? can I legally go after all his customers if I don't sign a contract with newco?

I believe this is one occasion where your human rights are on your side as it is unenforceable to stop you from earning a living - however have a look at the link (below) and also the exact wording of your old and new contracts

http://www.lindermyers.co.uk/are-res...eable_751.html

fivetide

iTrader: (1)

Remember - if you simply let people know where you are now working and they choose to contact you then you haven't technically solicited them for the work have you?

They contacted you right?

5t.

JohnSmith

Thanks Zohan

I haven't signed a new contract I have been told I am now employed by the newco but nothing in writing LOL

It's more a case of as long as I don't sign the new contract (remember no TUPE) will I be ok once in official administration

I was actually considering telling him I will not be signing the new contract but as he has a 300k orderbook to fulfill then I would gladly do this on a contractor basis (paid up front of course) so he doesn't lose continuity and knows exactly what he is paying for and can be trusted and more benficial for him for newco wage bill etc

I could use the angle that I want to spend more time at home and this way I can and still work for him but when it suits me so I can pick and choose the work

The major downside to the above is that I am one of the senior management team, but one of the other senior management works for us as a contractor (as legally he isn;t allowed to be on payroll due to doing the same thing with his previous oldco )

SPEN555

IMHO, he clearly stated you are NOT being TUPED. Therefore your contract is with a company that no longer trades. Fill ur boots n shaft him

I love people who are too clever for their own good

Also, if he's been planning it for months and he's a Director that knew it was going to fail he could go to prison for that as to trade while knowingly insolvent is a crininal offence IIRC.

Fat Boy

As above. Your contract was with oldco which has gone/will go into admin = ceased to exist so doesn't apply any more as long as you don't commit in similar ways in any new contract.

JohnSmith

He said he has only bought the assets, ie staff loans but not staff

Even if I commit to newco its a new contract so new terms apply like within 3 months no notice period etc etc

Devildog

Mate

He can't simply ignore TUPE - its not a choice, its a point of statute. It will exist whether he wants it to or not. you can, by mutual agreement, agree to change your contract of employment after the transfer, however.

A pre pack admin is simply one where the deal is done effectively immediately upon appointment. Makes no difference to employee regs.

As for the restrictive covenant, given that your contract technically does transfer across, what you have done could be challenged by newco, however that is extremely unlikely given your ex bosses stance.

In any event, it is not enforceable if the customers contacted you.

JohnSmith

He hasn't ignored TUPE per se he has just said that no-one is being TUPED across to the newco and we will all be on new contracts so no continuation of service etc

We havent had any written notification of redundancy etc but I am sure that will come, if only from the administrators on wednesday

If he isnt TUPEing us across then how can he transfer the contracts ?

Surely come Wednesday i can just fail to turn up for work citing that I do not and never have worked for Newco, and give my laptop tools etc back to the administrators ?

What also happened the other day is that the newco accountants said they simply cannot just do payroll as we have not had P45's. So we have all been given a P46 form to fill in

One customer (who got fleeced for 80k) has come to me direct

fitzscoob

Hang on, if he isnt TUPE'ing you across, I think he has to pay all staff redundancy. I'm not 100% I'm sure DD above will know better.

JohnSmith

I don't think he can, or rather I know there are no funds available to pay redundancy

Maybe this is why he sent an email to us last payday (29th Feb) stating that Oldco has no funds and is in 400k debt and going into administration and that we can claim our wages back from the governement and also he is giving us a loan of our wages from newco so we are to pay him back once we get our government claims LOL

fitzscoob

I dont think its that staight forward. If its a LTD company and he's the director there has to be funds to pay the likes of PAYE, VAT etc. and the redundancy. Otherwise I'm sure banks and gov't can go to him to pay. From sale of the assets which becomes a mine field if he has sold them on to himself, however I dont think that would hold water if a solicitor got their hands on it to try and straighten it out.

Again this is all a bit sketchy for me and I'm no way an authority, I had some experience on this when we sold our family business mid last year and went through the entire TUPE experience.

JohnSmith

He hasn't paid PAYE, the main reason he has gone into administration is because HMRC gave him 7 day notice to pay up or be wound up

He has done this all through a consultancy company, IP and Solicitors

He has already agreed weeks ago the asset value and sale to him and it has been agreed already (or so he says)

hodgy0_2

presumably his business plans don't include paying tax


and he still can't make a go of it


no wonder this country's fvcked

JohnSmith

I am almost sure he once said he uses HMRC as an interest free loan he doesnt pay them they chase he finally makes a payment ad infinitum until he no longer has the funds left

To be honest if he actually came in and worked full time we would be incredibly successful

However he loves the pub and loves his new bird and various other activities, has a stupid wage bill that has no need to be as high as it is. company cars that aren't needed and he needs to stop using the company as his personal bank account and live off his wage

Like I have said I could write a book LOL


One time we had an order for 120k that only needed to be delivered 3 months later, so that night once the funds cleared 60k went on 33 red and he spent the next 3 months trying to find the missing 60k

PaulC72

What a dodgy bloke he already has a new complany for when he wants to fold the other one.

hodgy0_2

does he drive a RR Sport by any chance

JohnSmith

No he used to drive an Audi big quattro thing then a bmw something or other 3 series now a mondeo

Paul he has another 2 companies setup already, he did have 3 but folded one back in August

Adn no doubt there will be a few others setup too in anticipation

ALi-B

iTrader: (1)

hodgy0_2

i hope were not relying on this section of the private sector to pull us out of the ****

JohnSmith

He needs a stretch inside really

I have a certain amount of incriminating evidence, but not sure how much it would stand up in court and I guess at worst case it would at least get an investigation done, best case would have him sent down

Down side is he would know it was me

BlkKnight

Directors of Phoenix companies really **** me off.

As had some of our customers do it to us.

On one occasion, all the suppliers joined forces and enlisted our own administrators to be involved with the winding up - net result, HMRC are looking into the old directors - with the intention to prosecute.

J

Puff The Magic Wagon!

iTrader: (2)

To my knowledge, if HMRC put a winding up order on the company and it ceases to trade, then you (employees) become preferential creditors. Therefore whatever is obtained out of the sale of the company, a larger part should be paid to the employees. Its not full wages but a %. This happened to me once and I got £800 out of about £3000(gross) owed.

I would strongly suggest you get some advice. Will PM you the name of someone who did a good job for me (who I also got from SN). Have an initial chat & see what he says.

PaulC72

You could always do an tip off to the HMRC and not leave your name.

Leslie

Is there a businessspeak dictionary?

Les

Devildog

He cant do that. Its not for him to decide. He has to accept continuity of service.

You can all agree new contracts if you want, but he must by law accept the continuity of service

Devildog

Puff

Doesn't matter who pulls the plug, or what type of formal insolvency process, employee claims have a preferential ranking for wages up to £800 or holiday pay due and unpaid in respect of the previous 12 months.

Preferential creditors claims rank after the costs and expenses of the insolvency though.

This is clearly a relevant transfer under TUPE law, however, and newco is liable

JohnSmith

Doesn't HMRC get first dibs on any money before the staff ?

From what I have heard today he HAS to appoint administrators on Monday as another winding up order has arrived (I think thats about 5 or 6 now)

Puff I got the PM Thanks

DD I am confused, but more because i'm not entirely sure what he is doing other than what he has told us which is the following

'You are not being TUPED across, fvck that i'm not that stupid, you will all be on brand new contracts, I have only bought the name, assets, email and kit, not the staff and you will all be signing new contracts'

The accountants could not set us up on payroll on newco as we don't have P45's and I sort of got told today we won't get P45's either ????

When asking the Office Manager (who resigned on Monday and her last day today) she assumed we were being TUPED across until I told her he said we weren't then she said ah that will be mainly for sales so they will be back on 3 month contracts so can be terminated at any point without notice or rights etc

However I DO know that he has given the administrators the list of staff being transferred over to newco and strangely this includes the office manager who now no longer works for oldco

On a side note I got a phone call this evening telling me that all his dodgy doings have been going on for many many years and I even got the names of his fake companies reeled off to me and the dates they started. I think the person who phoned me indicated that he tipped off the factoring company of the fake accounts hence us getting audited recently, but they gave him enough notice to photoshop statements and contact customers etc

I have been advised also I should get copies of anything that may be suspect and send to the authorities the moment I leave the company to essentially protect myself

JohnSmith

I have just seen that the boss has told the Administrators that he has offered all staff new contracts and not TUPE

He claims that the newco is not the same type of business as oldco

Hmmmm there is a big set of porkies as we are the same company, same products, services, same staff same accreditations same customers

I wonder why the IP cannot see through him, or maybe they aren't bothered as they are getting a wedge of money ?

JohnSmith

Hmm it now appears the administrators have told him he cannot ignore TUPE and at least has to consider it

He doesnt want to do that as he wants us all to claim our wages back so he can buy the company back for free

They (the admins) have told him that they can remove staff from the sale but its the same price,