Self employed and owed from job

[lmillswood]

My husband is self employed, he worked for a company on and off for about 2 months, the first invoice that we issued was paid but the next two were rejected by the bank and returned to us. The company we issued the invoices to and to whom I husband thought he was working for is different from the names on the two cheques that bounced so we do not know who to take to small claims court. The director of the company has also gone AWOL and his silent partner is trying to pick up the pieces and run he own business aswell. Any advice would be appreciated because we really don't know what to do.

[bluebottle]

Re: Self employed and owed from job

Hello and welcome to Legal Beagles.

A few questions...

Do you know if the silent partner is listed as a director of the company that owes money to your husband?

Have you run a credit check on the company to see if it is solvent or whether it has filed for voluntary liquidation or is the subject of a winding-up order or is going through a creditors' liquidation?

One thing you can do is go to the Companies House website and run a free check to see if the company is still trading. Go to Companies House. Please be aware that a company's trading name may be different from the name that appears on the register of companies, e.g. Joe Bloggs is the trading name, whilst Joseph Bloggs Limited is the registered name.

You need to be aware that it is a criminal offence for a company to trade whilst insolvent. If it does transpire that the company is insolvent or in liquidation, your husband is a creditor and should register his interest as a creditor.

Take the above steps first, then come back onto this thread should you need any further help or advice.

BB

[lmillswood]

Re: Self employed and owed from job

Thanks for your reply. The slient partner is a director in one of his companies but the partner that employed my husband has also set up another on the sly. Both are limited companies are still trading according to Companies House but we were under the impression that we were working for a company that was named on the shop but the cheques said different things. The silent partner also runs his own business at another location and has now taken over the shop and is trying to sort out the mess but as far as he is concerned he does not have to pay my husband. It is such a messy situation we really don't know whether to pursue it or just cut our losses rather than pay out for solicitors.

LM

[bluebottle]

Re: Self employed and owed from job

If your husband's status in this matter is that of a contractor, the usual rules of business apply, i.e. the company that employed his services is liable to pay the invoice presented to them for payment.

If, on the other hand, your husband was being employed as an employee on a self-employed basis, H.M. Revenue and Customs might be interested as that amounts to nominal self-employment and that is potentially illegal. The reason for this is because the employer evades payment of Employer's National Insurance Contributions and setting up a PAYE Scheme, which is an offence under tax National Insurance law.

In this situation, it appears that it is the company that employed your husband, not the partner who was a director. Therefore, the company is liable to pay.

If the amount your husband is owed is less than £5,000, you can issue proceedings in the Small Claims Court. This does not require a solicitor and is a relatively simple procedure. If you go to Website of the UK government : Directgov, the procedure is explained in plain English and there is also a video you can watch that explains what happens at a Small Claims hearing. However, the final decision is your's and your husband's.