Employees who worked for insolvent firms may be due extra pay

Employees who worked for a company that became insolvent may be due extra holiday pay dating back several years.

The Insolvency Service (IS) is contacting potential claimants after the Employment Appeal Tribunal decided that holiday pay should take commission into account if employees were entitled to it as part of their employment contract.

This decision affects everyone who has ever applied for and received holiday pay from the IS, which has provided the following guidance:

If you applied for payment after 31 July 2011

You don’t need to do anything yet. The Insolvency Service will soon be contacting you directly about how to apply for an additional payment if:

• you applied for and received holiday pay from us from August 2011 onwards
• you indicated on your application that you were entitled to contractual commission.

If you applied for payment before 1 August 2011

You need to contact the Insolvency Service to apply for an additional payment if:
• you applied for and received holiday pay from us before August 2011
• you indicated on your application that you were entitled to contractual commission.

For us to determine if you are eligible, we need some supporting evidence from you. So, when you contact us please include copies of the following documents:

• Your contract of employment with your employer at the time (or other evidence relating to that contract)
• Evidence of the commission you usually earned or evidence of the commission you earned in the 12 weeks prior to the date of insolvency.

Without this evidence we will not be able to determine if you are eligible for an additional payment.

Who isn’t eligible

You are not eligible for an additional payment if:

• we rejected your application for payment and you did not receive any money from the Insolvency Service
• you did not receive a payment for holiday pay from the Insolvency Service.

Further information available by emailing: [email protected].  Please contact Jackie Cuneen if you would like more information about the issues raised in this article or any aspect of employment law.