pay in lieu of notice

[a7mints]

I would welcome advice from someone who KNOWS the legal position.
I began a new job and after several months the company hit legal and financial problems and had to shut down one of its branches.I had booked a weeks holiday and on the day before I left for my holiday (lets say it was the 10th of the month) they told me my job was finished and the holiday would be my weeks notice.
However when I got my payslip the finishing date was given as the 10th not the 17th. So I believe if my actual finishing date was the 10th I was given no notice and should have had a week's pay in lieu of notice plus accrued holiday?

[flowery]

The legal position is that you are entitled to either a week's notice or whatever notice period is in your contract, whichever is greater.

So if you were informed on 10th of the month, you should have been paid until 17th of the month. They could do this by either having your termination date as 17th, or by having your termination date as 10th but giving you a payment in lieu of the week you would have been paid had your employment ended on 17th.

What reason have they given for not paying your notice?

[MrsSparkles]

As far as I know you either work it or they pay it, but in this case - had you accrued enough holiday to take a week off? They may have been clawing it back if you hadn't?

[MrsSparkles]

Sorry - should read better. If they've given your finishing date as the 10th, then yes you should be paid notice plus accrued holiday.

If it was the 17th my commen above stands re accrued holiday.

[daisychain01]

I think I'm right in saying that the week's pay in lieu of notice should be tax free. Even if your employer doesn't do their duty in that regard, you can talk to your tax office and reclaim the overpayment direct from them.

[flowery]

"I think I'm right in saying that the week's pay in lieu of notice should be tax free"

That would only be if the employer did not have the contractual right to PILON. If it's in the contract, it's a contractual payment therefore taxable. If it's not in the contract then it's paid outside/in breach of the contract so is technically like damages for a breach, and is not taxable.

The government is planning to change it so that even non-contractual PILON amounts will be taxable.

[daisychain01]

So are you saying that a7mints needs to find out what is in her contract of employment, flowery? From the description in the OP, I don't think it is clear whether it is contractual or not.

I just remember years ago that I was let go, given a payment in lieu of notice and they gave it to me tax free. So I thought it was worth mentioning,as every little helps as they say!

[KookyKind]

You need to ring ACAS. They know everything, are impartial and can contact the company on your behalf

From my experience you are entitled to both your weeks notice and holiday, unless you specifically agreed with the company no notice was required (little loophole a lot of companies try to get out with)