Guidance for claimants
What is Insolvency Benefit?
Insolvency Benefit will provide you with financial assistance if your employment ends because your employer becomes insolvent.
Can I claim Insolvency Benefit?
You can claim if you meet the following conditions:
- your employer (or former employer) is undergoing a formal process of insolvency (this must be the main reason you are no longer employed)
- you must have been an employee
- you must have been employed mainly in Jersey
- your employer must have been liable to pay Class 1 contributions for you in one or more of the three months before becoming insolvent
- your employer must owe you pay in respect of one or more of the four components of the benefit (see below)
How do I know if my employer is 'insolvent'?
We use the word ‘insolvent’ to refer to situations where a formal insolvency procedure is underway, including where an employer:
- has had their property declared en désastre
- has been made bankrupt
- has entered in to administration, receivership or liquidation
When an employer becomes insolvent they will usually be unable to continue trading or pay their debts, such as your wages.
An employer who has ceased trading is not necessarily insolvent.
How is Insolvency Benefit calculated?
Insolvency Benefit is calculated based on pay owed to you by your former employer in respect of the following four components:
- unpaid wages relating to the 12 months prior to your employment ending
- holiday pay relating to the 12 months prior to your employment ending
- statutory redundancy pay (one week’s capped pay for each year of service, subject to a minimum of two years’ service
- pay in lieu of notice on termination of employment (up to 12 weeks’ pay)
The maximum amount of Insolvency Benefit that we can pay you is £10,000. In addition, we will meet your liability for Social Security contributions and income tax (ITIS) on any Insolvency Benefit you are entitled to.
How to apply
Fill in an Insolvency Benefit claim form and return it to us.
You can download a form below or collect one from the Social Security Department.
Insolvency benefit claim form
Where can I get more advice?
For more advice, you can speak to the person or organisation that is dealing with the insolvency of your former employer (eg the Viscount’s Department or an insolvency practitioner), or the Citizens Advice Bureau.
See the JACS website for guidance on your rights to:
- statutory redundancy pay
- pay in lieu of notice on termination of employment
Guides to the Employment (Jersey) Law 2003 on JACS website
Guidance for insolvency practitioners
Insolvency practitioner guide
The guidance note below will help you understand what is expected of you in terms of best practice. This includes the giving of notice where possible, as well as the exchange and sharing of relevant information.
Download insolvency practitioner guide (size 34kb)