employer "freezing " company

T

telco

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Hi

My husbands employer has just informed him he is freezing the company- not sure what he that means by that exactly but from what I gather it seems there is no work available , and he does not want to go into liquidation as he has a high value court case pending(which he is likely to gain substantially from- his employers words) , if the company goes into liquidation it is unlikely the case will go to court. Where does this leave my husband with regard to redundancy ? can he apply to the department of trade and enterprise ? he is also due 4 weeks salary . What documentation is needed for him to apply ? I get the impression that his employer will not be very forthcoming in providing a letter.

thanks

T
 
Hi Telco,

In the first instance your husband should be pushing for payment from the employer.

If all else fails use the department of enterprise, trade and employment to reimburse your husband for arrears . But be warned you will be waiting a long time for this as I think you have to go to the employment appeals tribunal. I suggest you call the DETE they are very helpful.

What is your husbands boss going to do with this "substantial gain" when it the case is settled?

If the case is worth taking a liquidator would have a duty to continue the proceedings. How is your husbands boss financing the case?

If the company is insolvent your husbands boss has a duty as a responsible director to liquidate the company.
 
Hi Jack2009

thanks for your reply

We have had various issues in the past with him - non payment of CIF pension , waiting months for expenses to be paid etc...so as you can imagine the trust has gone . He is not a "responsible " director and yes he is insolvent....currently , if he wins this case he will be in a position to pay off his debts however anything that is left over , he will probably take as salary or plough into a new business he has set up ( not in construction).
I will call DETE today

Thanks

T
 
No bank or financial institution will provide a cashflow facility on the assumption there is a judgement awarded to the Company, payment of this judgement, if successful could take years.

Seems like Management are just clutching at what they can in the hope the case comes their way.

Like Jack2009 said, the Company has obligations to its employees, should the Company go into liquidaton the employees entitlements will be paid out of the State's insolvency fund, however only statutory amounts.

I think you should persue the Company for what payment you can and seek the balance from the liquidatior, as it would appear without fresh capital this is where the Company is going.
 
It would be unlikely that a liquidator would pursue the claim with the same enthusiasm as your husband's boss. It would also dramatically increase the cost of the liquidation.

So the best option is to avoid liquidation.
 
Brendan said:
It would be unlikely that a liquidator would pursue the claim with the same enthusiasm as your husband's boss. It would also dramatically increase the cost of the liquidation.

So the best option is to avoid liquidation.
Click to expand...

It really depends on the nature of the case and the amount of money involved and the likely hood of receiving a payment. A good liquidator would be like a dog with a bone when it comes to any potential asset of the company.

Either way if the company was in liquidation the creditors could rest assured that all relevant matters were being dealth with properly. It sounds to me like the director may be sticking his/her head in the sand!
 
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