City Link employees given administration advice

Published on January 5, 2015 by Crawfords Accounting

The high-profile collapse of the delivery firm City Link has led to employees of the company being given administration advice – specifically on how to claim money owed to them by their former employer.

An announcement from the Insolvency Service on December 29th warned of “a substantial number of redundancies in the coming days”.

Due to the nature of City Link, these are likely to include a mixture of directly employed and agency workers, and the administration advice given to these two groups differs significantly.

For those who were employed directly by City Link, the National Insurance Fund guarantees a basic payout, administered by the Insolvency Service via its Redundancy Payments Service.

As such, former employees who are made redundant can apply for certain contractual payments to be met, and 80% of any such claims should be paid within three weeks.

Certain limits are in place on these payments – including a maximum payout of £464 per week.

For agency workers, the administration advice is less positive: “The statutory scheme does not cover payments due to self-employed contractors or agency workers.”

As such, those left owed money by City Link have been told to contact their employment agency to determine how they may be able to proceed.

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