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Can I claim redundancy when Umbrella enters liquidation? Other ways to recoup losses?

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    Can I claim redundancy when Umbrella enters liquidation? Other ways to recoup losses?

    I'm currently an employee of Crystal Umbrella (Unitum Operations) who are going belly-up as I type; end client has an invoice raised to them for a weeks' work but this hasn't been settled by the end client to Crystal or by Unitum to me, and I'm looking like I'll be out of pocket once Unitum goes into liquidation - which appears to be a foredrawn conclusion after the meeting of creditors tomorrow.

    I'm looking at ways to recoup this pay.

    So far thoughts are:
    1) I'll be quite a longstanding employee of Crystal - my original employment contract goes back a fair few years for my sins. If they have folded, can I claim statutory redundancy from the Govt. redundancy service? (!). I realise this might be morally questionable, but would it be technically legitimate? A couple of salient points; Crystal (Unitum) did send out an email proposing that Pendragon could take us on on the same terms and conditions (though they're not related companies if you believe the spiel, so I don't think it constitutes an offer of a job that I'd have to consider). And I became a company director of my own Ltd co a couple of months ago before this kicked off; not sure if that is a problem for redundancy payout.

    2) Pendragon have offered to re-raise the invoice and pay me if I set up with them as my umbrella. I'm reluctant to do this as I was in the process of going Ltd anyway so it would only be for this one invoice; but it does raise the question if they have any kind of right to raise the invoice, couldn't my new co. just do that instead? There is still the issue of the invoice which was previously raised to the client which I would have thought the liquidators would be chasing. However, on further investigation that invoice is actually payable to Pendragon anyway(!). And in a further twist; when I asked Pendragon about this they said they won't be able to collect on this old invoice (perhaps as it is from Pendragon Consultancy trading as Crystal Umbrella, which I think puts them in a sticky position... as it is claimed that Crystal Umbrella is still the trading name of Unitum... who are folding... and furthermore it is now claimed that Pendragon are NOT related to Crystal... ho hum).

    Anyway, any advice or thoughts gratefully received.

    #2
    Long thread in the Crystal Umbrella debacle going in here.

    https://www.contractoruk.com/forums/...gone-bust.html

    Shoot to the end and I've raised the issue about GDPR and how Pendragon got your details in the first place. Being a completely unrelated company they shouldn't have your details. And yes, they are a new company so should have no relation to your agent/client so I don't see why you can't raise it.

    If you do need a brolly to raise your last few invoices or as a stop gap you be wise to speak Lucy at Contractor Umbrella who has posted in that thread and appears to be aware of the situation.

    Some useful info in there for you.
    Last edited by northernladuk; 4 December 2018, 21:36.
    'CUK forum personality of 2011 - Winner - Yes really!!!!

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      #3
      Govt. redundancy service
      What makes you think there is such a thing?
      'CUK forum personality of 2011 - Winner - Yes really!!!!

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        #4
        Originally posted by northernladuk View Post
        Long thread in the Crystal Umbrella debacle going in here.

        https://www.contractoruk.com/forums/...gone-bust.html

        Shoot to the end and I've raised the issue about GDPR and how Pendragon got your details in the first place. Being a completely unrelated company they shouldn't have your details. And yes, they are a new company so should have no relation to your agent/client so I don't see why you can't raise it.

        If you do need a brolly to raise your last few invoices or as a stop gap you be wise to speak Lucy at Contractor Umbrella who has posted in that thread and appears to be aware of the situation.

        Some useful info in there for you.
        I can't see why any umbrella would want to take me on to invoice a single week's pay for their £27 fee - it would never make financial sense.

        I've already posted on a few things in that thread. To be honest the GDPR stuff, while interesting, isn't the be-all and end-all. The pragmatist in me can't see there being any use in pursuing it - the company guilty of the GDPR breach are about to be liquidated, so what is the upside? Is there a useful (financial) upside to a GDPR breach? I'm much more concerned about getting paid (legitimately) than what is "right"...

        Things aren't as clear as they might be though as the invoices currently out there from "Crystal Umbrella" all claim Pendragon as the beneficiaries, despite "no relationship"... yeah, right.

        In any case, it is perhaps more profitable due to "length of service" to ignore any potential claim on that invoice, and go the loss of earnings / redundancy route (I think fag packet calc would say I'd actually get more than is owed on the invoice...). Opinions on this? I'm struggling to see why it couldn't work given I'm a long-standing employee of the umbrella who are about to be liquidated with a contract going back quite a few years.

        It has to be an unusual (perhaps untested) situation though; I mean it shouldn't really be possible for a PAYE umbrella to go into liquidation... takes a special kind of special, that. I'd imagine some raised eyebrows at the redundancy service as they get papers from hundreds of ex Crystal employees (though perhaps they've all jumped to Pendragon already, so there aren't many of us still on the ship...)

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          #5
          Originally posted by northernladuk View Post
          What makes you think there is such a thing?
          There has been one for years, they step in when companies fold without the funds to pay proper redundancy to staff.
          Edit - ok I used the wrong word - it is the Govt. Insolvency Service. But the function is the same.
          Factsheet: what to do when you’ve been made redundant - GOV.UK

          Comment


            #6
            Good idea to get over to the other thread and put this to the other people in the same boat. I asked about pensions as well but I think they've enough on to get the invoices sorted at the moment.

            though perhaps they've all jumped to Pendragon already, so there aren't many of us still on the ship...)
            I do hope not. The dot com website said they had 10k employees. The. Co. UK version said 50k.

            That said the. Co. UK is now redirecting to. Com with the Unitum details on. No sign of the Pendragon details we pointed out early in the thread.
            Last edited by northernladuk; 4 December 2018, 22:06.
            'CUK forum personality of 2011 - Winner - Yes really!!!!

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              #7
              Originally posted by northernladuk View Post
              Good idea to get over to the other thread and put this to the other people in the same boat. I asked about pensions as well but I think they've enough on to get the invoices sorted at the moment.
              I will do, I've mentioned redundancy a couple of times in my posts in that thread but it hasn't had any interest despite being an obvious upside. Perhaps there just aren't many folk with enough years service for it to be an issue.

              The only threads I've found so far discussing redundancy in relation to umbrellas have been where folk have had pretty short sharp thrift when asking about redundancy at the end of an assignment. And understandably I guess. Not seen any discussion of redundancies when the umbrella itself folds. It is hard to see why it is any different to any other employer folding.

              Anyway, posted in this subforum as I figured there would be the most experience of umbrellas in general in here.

              Comment


                #8
                Ah damn. Sorry. I didn't spot it was you.

                Doh
                'CUK forum personality of 2011 - Winner - Yes really!!!!

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                  #9
                  Originally posted by northernladuk View Post
                  Ah damn. Sorry. I didn't spot it was you.

                  Doh
                  No worries. I'm aware this probably isn't within the spirit of what the Insolvency service is about; but at the end of the day I'm sat here an employee (soon to be ex-employee, not of my own choice) of a company with wages due for work done (albeit minimum wage plus a topup bonus) and x years service; so if it is a legitimate route to me being made whole then it merits consideration. I would feel bad about cashing a cheque from the govt instead of from the brolly for about... 2 seconds.

                  So really the technical questions:
                  1) is this a situation where redundancy from the insolvency service could be claimed?
                  2) is there any previous case known of a brolly going under with employees who've claimed redundancy, and what was the outcome? Did the insolvency service wear the claims?
                  3) Would an email from the company suggesting that "unconnected co" Pendragon could take us on on the same terms and conditions (no evidence of that as yet) be enough to invalidate a claim of redundancy?
                  4) As a recently appointed director of a new company (as yet not raised any invoices) - would that preclude the use of the Insolvency service redundancy route?

                  Comment


                    #10
                    1 - Yes it would certainly seem so.

                    3 - No. You've not be TUPE'd or anything. They've just been introduced, all be it rather underhand, as a new employer to sign up with.

                    4 - definitely not. This is a new entity and has no bearing on what business you have with your old/ex employer.
                    Just a note though. Make sure your accountant factors in the tax you've already paid and what income you may get from this service when working out the most efficient salary /divis model for you. It's likely it won't be worth paying a salary from the LTD at first as you may well already be over the tax threshold.
                    'CUK forum personality of 2011 - Winner - Yes really!!!!

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