Sacked - Employee Loan to Repay.... BUT...

[mystery1]

Re: Sacked - Employee Loan to Repay.... BUT...

Is the interest rate above 1.5% ?

M1

[NWHC]

Re: Sacked - Employee Loan to Repay.... BUT...

The threats see to say they are accusing you of some wrong doing
I would be inclined to tackle that head on but that is up to you

Before you say you will call on the ex director , maybe you should check to see if he is willing to back up your story, after all people do tend to change their stories when their own reputation/neck is on the line. This could be particularly so if the investigations of the accounts show some less than open actions on his part

[teaboy2]

Re: Sacked - Employee Loan to Repay.... BUT...

The threats see to say they are accusing you of some wrong doing
I would be inclined to tackle that head on but that is up to you

Before you say you will call on the ex director , maybe you should check to see if he is willing to back up your story, after all people do tend to change their stories when their own reputation/neck is on the line. This could be particularly so if the investigations of the accounts show some less than open actions on his part

Even if the accounts did paint the ex-director in a bad light, leading him/her to be unwilling to be a witness, they can be ordered by the courts to be a witness of the defence via a witness summons (Supoena), even in civil court cases.

Though granted it is best to ask the ex-director first - Out of politeness more than anything else!

[NWHC]

Re: Sacked - Employee Loan to Repay.... BUT...

I understand what you are saying teaboy but isn't there still something in giving evidence that says you don't have to incriminate yourself. People are all too quick to abandon people when they really need help

[teaboy2]

Re: Sacked - Employee Loan to Repay.... BUT...

But the questions will only be specific to the case that OP is defending, therefore only specific to the actual the loan itself. There is nothing to suggest the director was involved in anything else. The treats made to the OP by the employer are specifically towards the OP.

And you can still testify as a witness even if your also accused of anything by the claiment, though the questions would have to be specific to the claim the employer is making against the OP, not subject to any accusation against the director themself! So in other words, if the take the OP to court about the loan, then that is all they can question the witness about! Plus the witness can refuse to answer questions that may incriminate them, or that are nothing to do with the claim against the OP!

[Amethyst]

Re: Sacked - Employee Loan to Repay.... BUT...

If it helps, I think the letter should end with 'strongly contested'.

I have taken it that there was not interest agreed on the loan and it was a simple here's X for X months pay it back at X a month.

[qazmko]

Re: Sacked - Employee Loan to Repay.... BUT...

Repay the loan as originally agreed. You should stick to the terms that you agreed with the company ( via the ex-director).

The loan was made to you by the company and authorised by a director of the company.

That is all that is important to you. It is not of your concern that the director acted without obtaining authorisation from his fellow directors.

If they bring court action you can rely on the terms which were agreed at the time of the loan and they will have to evidence otherwise. I do not see any point playing letter tennis about a non existent written agreement.

I'd respond to them someting along the lines of;

On xxxxx a loan of Łxxxxx was agreed between myself and XXX companyname xxxx and a verbal contract entered into with the company through Mr XXXXXX (Director). The terms of this loan were that it would be repaid at a rate of Łxxxx per calendar month with the first payment being made on XX January 2016 until XX whenever 2017. Payments will be made as agreed and should any court action be taken against me in respect of this loan the claim will be strongly contested.

This sounds good. I'll put this together tonight and send back.

Add the bit in red that i have added too. As you will be able to call upon the previous director as a witness should this go to court. And once they read that bit, it will more or less put a spanner in the works for them, as clearly the previous director is going to confirm everything you have said, and spill the beans of why he left i.e. argument with the shareholder / New director, whom immediately dismissed you as a result of the loan. Which would also probably win you your counter claim for unfair/wrongful dismissal against them!

Also add that if payment in lieu of notice and for accured holidays and any other monies outstanding are not paid to you within 14 days then you will subtract the amounts owed from the total balance of the loan!

Noted. Haven't seen/heard anything about final pay or P45 so will be interesting if there is a response on any of this..

Is the interest rate above 1.5% ?

M1

3.25% in line with HMRC's rates or it would be taxable + NI generating..

The threats see to say they are accusing you of some wrong doing
I would be inclined to tackle that head on but that is up to you

Before you say you will call on the ex director , maybe you should check to see if he is willing to back up your story, after all people do tend to change their stories when their own reputation/neck is on the line. This could be particularly so if the investigations of the accounts show some less than open actions on his part

Seems a bold statement, as if they are definitely threatening/blackmailing me to pay. I haven't done anything wrong so I think this is out of order.

Even if the accounts did paint the ex-director in a bad light, leading him/her to be unwilling to be a witness, they can be ordered by the courts to be a witness of the defence via a witness summons (Supoena), even in civil court cases.

Though granted it is best to ask the ex-director first - Out of politeness more than anything else!

I've spoken to him (ex-director) - he is 100% on my side. He can't stand the swines. He's got a bit of a battle going on with them as it is..

If it helps, I think the letter should end with 'strongly contested'.

I have taken it that there was not interest agreed on the loan and it was a simple here's X for X months pay it back at X a month.

See above

[Amethyst]

Re: Sacked - Employee Loan to Repay.... BUT...

So it's a formal beneficial loan arrangement. In what way are they saying it was unlawful? or is that all they have said?

[qazmko]

Re: Sacked - Employee Loan to Repay.... BUT...

So it's a formal beneficial loan arrangement. In what way are they saying it was unlawful? or is that all they have said?

No actual reason given..

Just them dropping the word in to make me panic maybe?

I questioned how it was 'unlawful' and got no response, just a further threatening letter.

[mystery1]

Re: Sacked - Employee Loan to Repay.... BUT...

As it's more than 1% above base rate then the consumer credit act applies. Send a section 77 request

M1

[teaboy2]

Re: Sacked - Employee Loan to Repay.... BUT...

Gald to see the Ex director is on your side, maybe we could help him/her with his own battle against this Muppet new director whom seems to be nothing more than a spoilt bully with a few quid in his bank account to throw around!

[NWHC]

Re: Sacked - Employee Loan to Repay.... BUT...

Its great to know the ex director is on your side. The reason I was cautious is that I have seen people lie through their teeth to save their own skins on many occasions.

M1 I find it intriguing that the Consumer credit Act comes into play, does that mean that the firm need a consumer credit licence?
If they do what are the consequences of not having one and who would be liable?

[Amethyst]

Re: Sacked - Employee Loan to Repay.... BUT...

For the odd employee loan they don't need a ccl. But the loan does need to comply with the CCA.

[NWHC]

Re: Sacked - Employee Loan to Repay.... BUT...

Thanks for explaining
The law is bizarre

[teaboy2]

Re: Sacked - Employee Loan to Repay.... BUT...

On top of what @Amethyst and @mystery1 have said @NWHC - If the employer can not produce a copy of the consumer credit agreement the loan was made under, then the company can kiss the money goodbye! Plus the employer would be in breach of the cosunsumer credit act 1974 as they are responisable for ensuring they comply with the law when issuing such a loan, not the employee!