Insolvency Benefit

​Guidance for claimants

About Insolvency Benefit

Insolvency Benefit will provide you with financial assistance if your employment ends because your employer becomes insolvent.

Claiming Insolvency Benefit

You can claim if you meet the following conditions:

1. your employer (or former employer) is undergoing a formal process of insolvency (this must be the main reason you are no longer employed)
2. you must have been an employee
3. you must have been employed mainly in Jersey
4. your employer must have been liable to pay Class 1 contributions for you in one or more of the three months before becoming insolvent
5. your employer must owe you pay in respect of one or more of the four components of the benefit (see below)

If an 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 Insolvency Benefit is calculated

Insolvency Benefit is calculated based on pay owed to you by your former employer in respect of the following four components:

1. unpaid wages relating to the 12 months prior to your employment ending
2. holiday pay relating to the 12 months prior to your employment ending
3. statutory redundancy pay (one week’s capped pay for each year of service, subject to a minimum of two years’ service
4. pay in lieu of notice on termination of employment (up to 12 weeks’ pay)

Insolvency benefit has a maximum payable value of £10,000 taking into account all of the above.

Your liability for Social Security Contributions and Income Tax (ITIS) payments on any amounts of benefit due to you will be deducted prior to payment being made.

Notice period end date calculator

How to apply

Fill in an Insolvency Benefit claim form and return it to us.

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 (for example, 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

The guidance note 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.

Insolvency practitioner guide