A simple typo from Companies House had caused 250 people to lose their jobs – and they won’t be receiving a pay-out in compensation.
Wales Online reports that back in 2009, Companies House mistakenly recorded Taylor & Sons Ltd as having been wound up, instead of another entirely unconnected company – Taylor & Son Ltd. As a result, the firm’s business ran dry, orders were cancelled, and credit facilities were withdrawn. Ultimately, the business ended up in administration.
Staff received statutory redundancy pay, the bare minimum they were entitled to.
However, while business owner Philip Davison-Sebry eventually struck an agreement to end the dispute with Companies House, the employees were left with nothing.
Robert Preston, who worked in the stores at the engineering firm, told Wales Online it was a “travesty of justice." He added:
"Companies House had a duty of care to the people who were affected, but the duty of care to the employees has been completely ignored."
A Companies House spokesperson said: “The High Court did not consider whether the duty of care affects former employees of the company. Anyone who feels the judgment affects the position of former employees of the Company may wish to seek independent legal advice.
"The High Court found that a duty of care existed in relation to a company that was not in liquidation but was wrongly recorded on the register as being in liquidation. We have agreed confidential terms of settlement and this case has now concluded."
Employee rights when a company is wound up
AABRS states that once the winding up order has been made and the compulsory liquidation begins, the employees will automatically be dismissed from their roles. The employees will then become ‘preferential creditors’ of the company and will be eligible to receive a payment from the company for unpaid wages, payment in lieu of notice, redundancy pay, or holiday pay.
It’s not guaranteed employees will receive everything they are owed, but they can claim for:
Up to eight weeks’ wages
Up to six weeks’ holiday pay
Statutory notice pay
Unpaid pension contributions
A basic award for unfair dismissal