I am currently on maternity leave and the company I am working for is possibly going into liquidation. I am scheduled to return to work after Easter 2012. At the moment I am still due three months full pay, then SMP until February 2012 and then a month’s holiday pay (carried over from this year’s holiday allowance). Should the company close what is still owed to me and how will I go about putting a claim in for it? All I have been told at the moment is that should the company go under I will have to claim the SMP directly from HMRC. Will I be owed the 3 months salary, any accrued holiday pay and any redundancy?
If the company becomes insolvent, then the position in terms of outstanding monies owed to employees will depend upon the type of insolvency proceedings that are used. However, it is likely that you will rank as a “preferential creditor” for the purpose of any outstanding contractual payments, e.g. contractual maternity pay, accrued holiday pay, etc. This means that you would be entitled to be paid in priority to other categories of creditors (with the exception of those holding fixed charges against the company’s assets).
In reality, it may be that the assets of the company following the insolvency proceedings are insufficient to cover all of the outstanding monies owed to you. If this is the case, you may be able to claim through the National Insurance Fund (NIF) in respect of some of the monies owed to you under your contract of employment, including notice pay and holiday pay. However, there are various caps as to the amounts that you can claim through the NIF, and contractual maternity pay is not listed as a principal debt payable from the Fund. As such, it may be that you are unable to recover this sum.
As you are already aware, your entitlement to statutory maternity pay is protected and you would claim this directly from HMRC.