Claimant v The Insolvency Service
Outcome
Individual claims
The claimant was owed 302 hours of unpaid wages at £12.50 per hour. The tribunal accepted the claimant's evidence and found the second respondent liable for the arrears of wages accrued after the CVA date. The claims against the first and third respondents failed because the appropriate insolvency date was the date of the CVA in 2019, not the later liquidation date in 2023.
The claimant had accrued but not taken 22 days of holiday pay at £151 per day. The tribunal accepted the claimant's evidence and found the second respondent liable for the accrued holiday pay. The claim against the Insolvency Service failed because the appropriate insolvency date for claiming from the National Insurance Fund was the CVA date of 19 September 2019, not the liquidation date, meaning debts accrued after that date could not be claimed from the Fund.
Facts
The claimant was employed as Operations Manager by the second respondent from 1 November 2018 to 26 July 2023. The second respondent entered a CVA on 19 September 2019 and subsequently entered creditors voluntary liquidation on 4 August 2023. The claimant was made redundant and claimed arrears of wages (302 hours at £12.50) and holiday pay (22 days at £151 per day). He received redundancy and notice payments from the Insolvency Service but not the outstanding wages and holiday pay.
Decision
The tribunal awarded the full amounts claimed against the second respondent but dismissed the claims against the first and third respondents. The claim against the Insolvency Service failed because under the Employment Rights Act 1996, the appropriate insolvency date for claiming from the National Insurance Fund was the CVA date in 2019, not the later liquidation date, meaning debts accrued after the CVA could not be claimed from the Fund.
Practical note
When an employer enters a CVA before later liquidation, the CVA date is the relevant insolvency date for National Insurance Fund claims, preventing employees from claiming arrears that accrued between the CVA and liquidation—a harsh but legally clear result confirmed in McDonagh.
Award breakdown
Legal authorities cited
Statutes
Case details
- Case number
- 1405074/2023
- Decision date
- 9 February 2024
- Hearing type
- full merits
- Hearing days
- 1
- Classification
- contested
Respondent
- Sector
- public sector
- Represented
- No
Employment details
- Role
- Operations Manager
- Service
- 5 years
Claimant representation
- Represented
- No