Redundancy and PILON

[Daddynick82]

Hi all, my first post on the site but a complicated one and I’m hoping someone can help.

i don’t understand PILON when a business will be insolvent and have just been made redundant (as of this Friday). Essentially, should the business have the funds, I would likely have been paid both my redundancy pay and 12 weeks PILON on or around my finishing date. This however will not be the case and instead, I will need to apply for my redundancy and PILON. I’m currently in SSP following an accident and may remain on SSP for a little while, whilst receiving treatment to get myself fit again and am worried about not receiving everything I am entitled to.

I’ve been advised that when you are being paid your PILON by the government, any income, benefits etc are taken into account and reduce the figure you will receive. Is this correct? I’m baffled that some people (if the company they work for has the funding) will be paid their notice payment upfront in bulk and can then land a job (if lucky enough) the following week, whilst others like myself have to apply for it and may not actually receive anywhere near the same as ours is reduced over time? If I stepped into a job next week, I wouldn’t see any of the notice payment at all.

is the above correct and is there any way around it? I’d hate to think that I miss out on over £5k when others are lucky enough to receive it.

many thanks in advance!

[ULA]

If you have been made redundant because your employer is insolvent then you will be entitled to claim:

1. Redundancy pay if you have over 2 years of service a the rate of:
* half a week’s pay for each full year you were employed and under 22 years old
* one week’s pay for each full year you were employed and between 22 and 40 years old
* one and a half week’s pay for each full year you were employed and 41 or older
Redundancy payments are capped at £700 a week and you can get a payment for a maximum of 20 years that you were employed at the business.

2. Wages - up to a maximum of eight weeks, capped at £700 per week

3. Holiday pay – accrued to time of termination but not taken, up to a maximum of six weeks, capped at £700 per week

4. Compensatory notice pay – one week after one calendar month's service rising to one week per year of service up to a maximum of 12 weeks. A

To be able to claim for points 1-3 you will need to be given a CN number from the insolvency practitioner and make the claim within 6 months and for point 4 you will need an ‘LN’ reference number to make a claim. This will be sent after your notice period would have ended and you must have made a application for redundancy pay even if you are not entitled to any.

The reason why this is sent after your notice period has ended is that is will need to take account of earning that you may have received during that notice period such as from a new job, benefits you are claiming OR could have claimed and would have been entitled to, even if you did not claim them. As you set out you may not think that is fair but that is the way the government support is provided.

If you are on SSP I believe that you will now need to claim this via the Department of Work and Pensions (DWP)