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How does liquidation affect company employees?
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The liquidation of a company can have serious implications for employers. The liquidator will take over the running the business and will decide how to handle the business and its assets for the benefit of the company’s creditors.
The liquidator will also decide whether to continue trading. If trading is terminated, there may be loss of jobs. In this case, a form is available to claim for any loss of salary, wages, holiday pay and/or redundancy that is owed. The claim will be a debt in the liquidation.
As an employee, the claim for unpaid salary or wages and holiday pay is preferential. This means it ranks ahead of unsecured creditors if there are funds available.
