Employee unable to recover over $8,800 in unpaid wages after company is liquidated…

An employee has been dismissed a day before the company he was working for went into liquidation. The employee was told that the company had been taken over by another company, and that the take-over company would offer him a new employment agreement. The employee was then not offered the position.

The Employment Relations Authority upheld the employee’s personal grievance claim for unjustified dismissal.

The ERA found that the employee was not consulted with before his dismissal and that he was not given a clear reason for the termination of his employment.

The ERA found that the employee was owed wage arrears totalling over $8,800, but held that the employee was unlikely to receive the amount out of the proceeds of the liquidation.

The ERA held that the employee was not entitled to seek payment of the sum from the take-over company as it was not his employer before or at the time of his dismissal.

The ERA noted that the take-over company had no obligation to offer the employee an employment agreement given that the employee had been dismissed from the old company before it was liquidated.

This case demonstrates the lack of protection for employees who are working in businesses that are transferred between owners.