Employer not paying me - need help!!

[Michael Joachim]

I work for a small biopharmaceutical company in the UK. I am employed under contract as a full time worker with a monthly salary at our UK labs (pretty straight forward). We also have a site in Malaysia. The CEO who oversees all is based in Malaysia.

 

The company acquired new Amaerican owners to fund us in 2011. Since then the company has been struggling financially. As a result I have not been paid since November 2011 (2.5 months ago). I have 3 other colleagues in our UK labs in similar situation. We have written an "email before action" demanding money by the 31st January 2012. We still haven't been paid despite false promises of money coming in "very soon" or "by the end of the week" etc... In addition it is evident that money has been paid by our investors towards lab rent costs rather than salaries.

 

I needed to claim benefits to help with my rent. For this I needed payslips stating that I have not been paid as evidence. I received payslips stating that I had been paid in full!! After reminding them this was fraud I then received the correct payslips.

 

We want to get the ball rolling with legal action to get our salaries but my questions are:

 

- What is the best way to go about this? Employment tribunal alone? (we are pretty capable people and have evidence of bank statements, emails etc at hand). Or phone a solicitor?

 

- Is it better to claim combined as a four or claim individually?

 

- What can we claim for? Our contracts state that either employer or employee need to give 3 months notice on terminating contract. So in addition to our salaries can we claim for 3 months notice period salary too?

 

- Who is the best to make the claim against, the CEO (directly responsible for us) or our American funders who acquired us?

 

- How likely are we to succeed in claiming considering our CEO is in Malaysia and our funders are in America? I would imagine logistics would be a nightmare from the UK!!!

 

Thank you and hope to hear soon.

[Gbarbm]

Hi Micheal

What an awful situation for you and your colleagues to be in!

Do you have a union or professional body and if so are they aware of this and what is their take on it?

Clearly the employer is in breach of contract particularly regarding mutuality of obligation which means, I give up my time to work for you and you pay me.

I was interested in the issue of the payslips showing full pay... Did it also show tax and NI as having been deducted?

[Michael Joachim]

Unfortunately none of us are members of any union! A lesson to learn for the future noted!

 

Yes all deductions were shown on the payslips. Even more bizzare, on the corrected payslips deductions NI, tax are still shown, however it states only net pay to be £0 "non payment".

[Gbarbm]

Are any of you members of a professional body (? Association of lab technicians?) because they will very often have legal advisers who could maybe help.

The employer appears to have committed a breach of the PAYE regulations by appearing to have falsified deductions (I'm choosing my words carefully here)

Do me a favour, look at the last payslip provided to you when you did actually receive your salary and check to see if the cumulative total for tax and NI is the same figure on the current nil payslip.

The reason I ask this I'd because if you have a reduction in salary (in your case to nil) there should be a corresponding decrease in the tax leading to a refund.

Is the payroll based in the UK? If so, could you ring them to check the position.

[jacketpotato]

** VERY IMPORTANT ** A claim for unpaid wages is known as a "deduction of wages" claim in Employment Tribunal lingo. You MUST bring such claims in the Employment Tribunal within THREE MONTHS of the deduction. Its very unlikely that you would get an extension, if you missed the time limit you'd need to go to court which is more expensive and difficult than going to the Employment Tribunal. As we are nearing the 3month deadline I suggest you speak to the CAB ASAP, if in doubt have a go at drafting an ET1 yourself (its on the Employment Tribunal's website) and post it on here with personal details removed and I'll take a look.

 

- What is the best way to go about this? Employment tribunal alone? (we are pretty capable people and have evidence of bank statements, emails etc at hand). Or phone a solicitor?

 

The Employment Tribunal is a neutral forum, they won't act as your advocates. You could use a solicitor to help you, alternatively you could ask the CAB who should be able to help you prepare for an Employment Tribunal claim. In London they may be able to refer you to get free representation on the day. You could also contact ACAS.

 

If you just want to claim the unpaid wages, a "statutory demand" (google it) could be used if your employer is a company, essentially this is a threat that you will apply to have the company liquidated unless the debt is paid. This is simpler than an Employment Tribunal claim but there are drawbacks and you would have to get the legal technicalities right.

 

- Is it better to claim combined as a four or claim individually?

I believe you need to claim individually. There is a space on the ET1 (the Employment Tribunal claim form) to indicate that your claim is one of a similar number of claims and you can ask the Employment Tribunal to join your claims. If you are complaining about the same thing joiner would be sensible.

 

- What can we claim for? Our contracts state that either employer or employee need to give 3 months notice on terminating contract. So in addition to our salaries can we claim for 3 months notice period salary too?

This is really two separate claims. The unpaid wages claim is simple breach of contract and I don't see how your employer could defend that claim.

 

To get the 3 months notice pay you would need to resign and claim that you were dismissed. You are considered to have been dismissed if you were forced to resign by the employer's serious breach of contract, this is called constructive dismissal. There would be scope for the employer to argue that it wasn't reasonable for you to resign, but this would seem to be a losing argument given the length of time you have been unpaid.

 

- Who is the best to make the claim against, the CEO (directly responsible for us) or our American funders who acquired us?

In all likelihood, neither. You sue your employer, not the manager or shareholder of a company except in fairly exceptional circumstances. I guess that your employer is probably a UK-based company owned by a parent company based elsewhere, your payslip should say who your employer is.

 

- How likely are we to succeed in claiming considering our CEO is in Malaysia and our funders are in America? I would imagine logistics would be a nightmare from the UK!!!

It would help your chances of success if your employer can't get its act together in the Employment Tribunal. But getting them to pay up might be more of a problem if they are in financial difficulty and do not have significant assets in the UK. See http://www.direct.gov.uk/en/Employment/Employees/Pay/DG_10026695 and http://www.direct.gov.uk/en/Employment/ResolvingWorkplaceDisputes/Employmenttribunals/DG_182912.

[Sidewinder]

** VERY IMPORTANT ** A claim for unpaid wages is known as a "deduction of wages" claim in Employment Tribunal lingo. You MUST bring such claims in the Employment Tribunal within THREE MONTHS of the deduction. Its very unlikely that you would get an extension, if you missed the time limit you'd need to go to court which is more expensive and difficult than going to the Employment Tribunal. As we are nearing the 3month deadline I suggest you speak to the CAB ASAP, if in doubt have a go at drafting an ET1 yourself (its on the Employment Tribunal's website) and post it on here with personal details removed and I'll take a look.

 

The claim can be made within three months of the last in a series of deductions, so where the OP is still employed by the organisation and the deductions are ongoing, the clock would only start ticking were the employment to be terminated.

[Michael Joachim]

Deductions of tax and NI are the same on each payslip. However, total tax and NI paid to date is less on the nil net salary payslips. Payroll is in the UK so I could check.

[Michael Joachim]

Thanks for the comprehensive advice! I have downloaded the employment tribunal ET1 form. I shall get a claim sent ASAP and instruct my colleagues to do the same. Then if we need to we can link up claims later down the line. And if we need to take on board a no win no fee solicitor to represent then we have that luxury also. I have a contact.

 

Thanks!!

[Gbarbm]

All the best Micheal,

If you need further help/advice post back here

Kind regards

Gbarbm

[becky2585]

I would add that in these circumstances, you would have a very good constructive dismissal claim as well as a claim for wrongful dismissal (your three months' notice pay), unlawful deduction from wages which would encompass the arrears of pay and potentially payment in lieu of accrued but untaken holiday pay. Constructive dismissal claims, as a very rough rule of thumb, attract a compensatory award of around 26 weeks' pay, if you have not secured another job in that time. Of course, clearly, you'd have to resign to bring that claim.

[jacketpotato]

The claim can be made within three months of the last in a series of deductions, so where the OP is still employed by the organisation and the deductions are ongoing, the clock would only start ticking were the employment to be terminated.

Indeed, although I wonder if there is a question as to whether not paying someone on three separate occasions would constitute an ongoing series of deductions. Do you think there is scope for the employer to argue that the deductions are separate or point towards different reasons for each non-payment?

Edited February 7, 2012 by jacketpotato

[Sparklez30]

Deductions of tax and NI are the same on each payslip. However, total tax and NI paid to date is less on the nil net salary payslips. Payroll is in the UK so I could check.

 

I am no expert but no one seems to have picked up on this. Surely a reduction in the tax & NI to date on the nil payslips implies a rebate has been put through for the periods you have not been paid but they obviously have not paid you your tax rebate and it is not reflected on the payslips either.

 

This seems dodgy to me - where exactly has the reduced tax & NI gone? Hopefully someone wise and clever will know what this means but it seems to me that if this is not corrected come the end of the tax year they will have collected your tax & national insurance rebates which obviously they are not entitled to and based on those records you would not be able to reclaim it from the taxman?

[Gbarbm]

Read my earlier posts

Gbarbm

[Sparklez30]

Read my earlier posts

Gbarbm

 

Sorry Gbarbm i didn't spot that you had requested the info first

 

The payslip is clearly wrong - As you point out nil pay would end up with a refund which the employer would have to pay back to the employee. It is highly probable therefore that the employer owes more than just the missed salaries at this point but also the refund of tax and national insurance for the past few months - accurate payslips would definitely be a plus

 

I know nothing about the tribunal / legal side though could the tax and NI refunds also be claimed through the Tribunal or does HMRC deal with everything tax?

[Gbarbm]

No worries Sparklez (what a lovely name)

I don't think there's any harm bringing this out in the ET. HMRC can and do use information from tribunals in respect of tax/NI issues.

What they can do, irrespective of wether the amounts have actually been remitted, is, in order to maintain the contributory principle, deem the amounts to be paid by posting them to the NI account.

The dear old employer would of course have to make good the amounts due as well as intrerest and penalties to "reimburse" HMRC for loss of the use of the monies.

There is nothing to be lost (and everything to be gained) if the OP should decide to ring the tax evasion hotline to report the matter (details on HMRC website)

[Sparklez30]

See thats what I meant by someone more knowledgable!!

 

Good luck Michael it is a terrible situation you have been left in!

[bonnygirl]

Unfortunately none of us are members of any union! A lesson to learn for the future noted!

I feel it’s wise not to be in a union (a total wast of money) as they will not provide any legal assistance to member, if their workplace is not unionised. Even then they are very reluctant to spend any money on members. They will only give any assistance if you case certain of winning and if it’s going to bring them headlines in the media.

Much better to get insurance for cover on your home insurance at least then you have a choice of getting a reasonable legal service. Look at other posts on here about unions how they have let their member down.

[cerberusalert]

I feel it’s wise not to be in a union (a total wast of money) as they will not provide any legal assistance to member, if their workplace is not unionised. Even then they are very reluctant to spend any money on members. They will only give any assistance if you case certain of winning and if it’s going to bring them headlines in the media.

Much better to get insurance for cover on your home insurance at least then you have a choice of getting a reasonable legal service. Look at other posts on here about unions how they have let their member down.

 

Utter tosh, I speak from personal experience both as an ex-shop steward & convenor, unions or at least the larger ones have their own legal teams & access to Barristers.

 

I know of at least one supermarket chain that is not 'unionised' where there are numerous legal cases being pursued by the GMB ranging from unfair working practices, unfair dismissal through to personal injuries.

[becky2585]

Nope - case law is fairly clear on this point. An ongoing series of deductions is an ongoing series of deductions if they are related. So for example, a deduction for uniform in 2009, followed by a deduction from wages in 2011 would not be related, whereas a monthly series of deductions almost certainly would be.

[bonnygirl]

Utter tosh, I speak from personal experience both as an ex-shop steward & convenor, unions or at least the larger ones have their own legal teams & access to Barristers.

 

I know of at least one supermarket chain that is not 'unionised' where there are numerous legal cases being pursued by the GMB ranging from unfair working practices, unfair dismissal through to personal injuries.

That is excellent, if that is the case, my dad was in the same union you mentioned and he had a rep with him at a meeting with manager, GP gave employer instructions to change my dad's work position every 1 hour for his disability, BUT the union rep said that would not be good for the company business and HE said that it should be every 2 hours. The rep was supposed to be representing my dad as he was paying his subs as far as I know dad's company was not paying him….why was the rep against my dad being of work position every hour as his GP recommended ….

[cerberusalert]

That is excellent, if that is the case, my dad was in the same union you mentioned and he had a rep with him at a meeting with manager, GP gave employer instructions to change my dad's work position every 1 hour for his disability, BUT the union rep said that would not be good for the company business and HE said that it should be every 2 hours. The rep was supposed to be representing my dad as he was paying his subs as far as I know dad's company was not paying him….why was the rep against my dad being of work position every hour as his GP recommended ….

 

Yes they are there to represent the individual member but they also have to look at the wider implications which affect both the employer and other members.

 

Without knowing the history of your father's case I couldn't possibly comment other than to say it may have caused more problems than it solved and the rep had negotiated a compromise which may have saved your father's job. A GP's recommendation is just that a recommendation and an employer is not bound by it.

 

As an aside, it is quite normal for union reps and management to hammer out negotiations prior to any 'official' meetings.

[bonnygirl]

No the union Rep did not save my dad's job also the rep he had no meetings with anyone from my dads company prior to meetings with my dad. My dad health suffered as a result and the union rep seem not to care less. He has left the union now, I wonder why.........