Cases1800823/2025

Claimant v Stubbs Construction Limited in creditors' voluntary liquidation

2 January 2026Before Employment Judge JM Waderemote video

Outcome

Partly successful

Individual claims

Unlawful Deduction from Wagessucceeded

The tribunal made a declaration that the first respondent made unlawful deductions from wages for arrears of pay and holiday pay as claimed. The claimants had already made claims in liquidation. The respondent company was in creditors' voluntary liquidation and did not attend.

Holiday Paysucceeded

Holiday pay claims succeeded against the insolvent first respondent by declaration. The Secretary of State had refused payment via Redundancy Payments Service applying settled law in Briman. Claims against the third respondent were dismissed as the Secretary of State had no liability under that case law.

Unlawful Deduction from Wagessucceeded

Arrears of pay claims succeeded against the insolvent first respondent by declaration. The claimants were content with declaratory relief as claims had already been made in liquidation, though recovery was doubtful. Claims against second respondent withdrawn; against third respondent dismissed applying Briman.

Facts

Eighteen employees of Stubbs Construction Limited brought claims for holiday pay and arrears of pay after the company went into creditors' voluntary liquidation in November 2024. All employees were dismissed between 8-12 November 2024 following breach of a CVA that had been in place since December 2023. Redundancy and notice pay had been paid by the Redundancy Payments Service, but holiday pay and arrears were refused.

Decision

The tribunal granted declaratory relief against the insolvent first respondent for unlawful deductions of wages (arrears and holiday pay). Claims against the liquidators (second respondent) were withdrawn. Claims against the Secretary of State (third respondent) were dismissed applying settled case law (Briman) that the state has no liability for such payments in insolvency.

Practical note

Following Briman, the Secretary of State has no liability to pay holiday pay or arrears of pay via the Redundancy Payments Service when an employer becomes insolvent, leaving employees as unsecured creditors with little prospect of recovery.

Legal authorities cited

Secretary of State for Business Innovation & Skills v Mr M V McDonagh and Others, Briman DBS Ltd (In Liquidation)/The Secretary of State for BIS v Miss J Pengelly, Woolston Manor Golf & Country Club Ltd (The Company) 2013 WL 1841649

Case details

Case number
1800823/2025
Decision date
2 January 2026
Hearing type
full merits
Hearing days
1
Classification
contested

Respondent

Sector
construction
Represented
No

Claimant representation

Represented
Yes
Rep type
lay rep