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When a company enters liquidation, it can be an uncertain and stressful time for employees. Questions around job security, outstanding wages, and redundancy entitlements are common, and understanding your rights can make a difficult situation a little clearer.
In this article, we address some of the most frequently asked questions employees have during liquidation, including what happens to their employment, how to claim money owed, and what support is available through the Redundancy Payments Service (RPS).
Questions and Answers
Can I retain my job?
In most cases, no. Liquidation usually means the company ceases trading and employment ends immediately upon the appointment of the liquidator.
However, in some rare cases, the liquidator may temporarily retain staff to help wind down operations or sell the business
Will I get any of the money I’m owed?
You may not get your final wages, holiday pay or pay in lieu of notice directly from the company, but you can usually claim from the UK Government’s Redundancy Payments Service (RPS), which covers:
- Up to 8 weeks’ unpaid wages
- Holiday pay
- Statutory notice pay
- Statutory redundancy pay
These payments are subject to a weekly capped limit and based on length of service. A Liquidator will facilitate you to claim unpaid wages, holiday pay, redundancy, and notice pay from the Redundancy Payments Service (RPS) – even if the company has no funds.
Can I apply for redundancy if I haven’t worked there for years?
You only need to have worked there for 2 years to claim statutory redundancy.
Do I need to do anything to claim redundancy or will someone sort it out for me?
You must submit a claim to the Insolvency Service / RPS to get paid.
The liquidator will give you:
- A CN (Case Number) for your claim
- Instructions on how to apply online
No claim = no payment, even if you’re entitled.
While company liquidation often means employment ends, it doesn’t mean employees are left without support. Knowing your rights and the steps to take, such as submitting a timely claim to the Insolvency Service / Redundancy Payments Service — can ensure you receive the payments you’re entitled to.
If you’re affected by liquidation, it’s always best to seek guidance early and make sure you understand your options. The liquidator’s role is to help facilitate the process, but ultimately, your claim must be submitted to access those funds.
Understanding the process empowers you to take control during what can be an uncertain time.