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Arena Magazine 2007 Issue 3 Autumn Arena |
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Kwik Save staff rights
Your question answered.
I noticed Kwik Save went bust earlier this year with staff not having been paid wages and/or redundancy pay. Do staff have any rights when companies suddenly close down?
Yes. Under the Employment Rights Act 1996 staff can claim, up to a certain limit, from the Redundancy Payments Service (RPS), part of the National Insurance Fund, for the following payments:
- Outstanding salary/ accrued holiday pay
Your right to recover arrears of wages and accrued holiday pay is limited to eight weeks pay in the case of wages and six weeks pay in the case of outstanding holiday pay. There is also a cap on the maximum amount of a week's pay, currently £310.
When staff are not paid in lieu of notice you can make a claim to the RPS for money representing the notice that you should have been paid. The amount you can recover from the RPS is limited in the following ways: You can only recover an amount equivalent to the minimum periods of notice laid down by statute (this effectively amounts to one week's notice per year of service up to a maximum of 12 weeks).
A week's pay is capped. The rate is based on your rate of pay, but is capped at £310 after all deductions have been made.
- Statutory redundancy payment
If you have completed at least two years continuous service with the company and you are within the prescribed age limit, you may qualify for statutory redundancy payment. The whole of your entitlement to statutory redundancy payment is recoverable from the RPS.
If you consider other sums, like expenses, you have to submit a detailed claim to the administrators as soon as possible showing how they were incurred and attach invoices/receipts.
You should ask the company's administrators for form RP1, fill it in and send it to the Redundancy Payments Office. You must act within six months of your employment being terminated.
While this advice is accurate it is not a definitive guide to the law.
If you have any concerns you should contact your local rep/official or ring the helpline 0845 6060640.
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