Phil MeekinView Profile
If you have been unfortunate enough to experience your employer going under, you will know and understand it’s a scary experience. Unless you’ve been in the know since things started going downhill, it can often come as a major shock and leave you in a position of major uncertainty.
How can it affect you?
The sudden realisation that the regular wage you received every week or month will stop, but yet all the bills and commitments will continue coming can leave you in a nightmare. Rent, mortgage payments, council tax, electricity bills, credit card bills and a host of other commitments will still be there.
Although It’s hard not to picture the potential financial misfortune you could be in, there are aids out there to help you through difficult periods.
What help is out there
Some liquidations and administrations are forced upon a company as creditor pressure simply becomes too much. As an employee, you can, unfortunately, be left leave you down the pecking order when it comes to unpaid wages, holiday or redundancy pay. After all of the secured creditors have been paid, employees are next when it comes to entitled arrears.
Company’s entering into liquidation are more often than not, not in a strong position financially and employees will often be left out of pocket. If this is the case, employees are still covered by the Redundancy Payment Service.
Finding a new job in the current market place isn’t always an easy task and even after receiving a redundancy payment, you could still find yourself falling on hard times. If money becomes an issue to a point where you’re struggling to pay your bills, there are repayment plans which can be put into place to make things more manageable.
Individual Voluntary Arrangement – (IVA)
An Individual Voluntary Arrangement (IVA) is a formal, legally-binding debt solution plan. It is available as an alternative to bankruptcy for individuals in England & Wales, who are struggling to repay their debts.
Although your employer going bust can leave you in the dark and an uncomfortable position financially, they are still obligated to take care of you in their creditor’s list, if they can. Alternatively to that, there is the Redundancy Payment Service, which was set up to help employees in these scenarios.
If redundancy hits you hard in the long term, there are repayment schemes available to help you avoid bankruptcy.