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Company liquidation(4 Posts)
Sorry if this isn’t the right thread but wondering if anyone has any information about what happens if your company goes bust just before you finish for maternity?
I’m 29 weeks now and have around 6 weeks left in work however if you watch the news cough there’s a very real possibility my job is in trouble.
I’ve had a look at HMRC website but it’s not the most useful - I’ve read that you can wait months to get paid what you’re owed if it goes to administrators etc
HMRC will pay your SMP.
(In that article "you" is the company)
Anything above SMP (contractual maternity pay) will have to be claimed in the Insolvency though, HMRC won't pay that. Redundancy payments service also won't pay contractual maternity pay.
When the company becomes insolvent you become a creditor as you are owed money
The government will pay you certain capped sums due - pay in lieu of notice, SMP, AOS holiday pay, statutory redundancy entitlement. The government then claim as a creditor in the Insolvency.
You will need to claim in the Insolvency for anything above the amounts the government pay you. Employees are "preferential creditors" ie they get paid from the assets before anyone else does.
Example: your contractual maternity pay is full pay which is £600 a week, including £100 SMP. HMRC will pay you £100 SMP, and claim for that in the Insolvency. You will need to claim in the Insolvency for the remaining £500, and will only get the money if money is paid out to creditors (which can take a LONG time). The Redundancy Payments Service will also pay you in lieu of notice and redundancy entitlement - again, these are capped and you would need to claim in the liquidation for any difference eg if your contractual redundancy was more than statutory entitlement.
Thanks so much for the information!