What to Do When Your Company Owes You Money

Imagine working hard for your employer, only to find out that you’re not getting the money you deserve.

It’s a frustrating and disheartening situation that no one should have to face. Unfortunately, it does happen.

Options summarised:

Understand your employment contract to identify what is owed.
Take legal action if wages are unpaid, and review paylips for underpayments or deductions.
Seek professional advice when communicating with employers and exploring payment solutions.

So, what to do when your company owes you money? In this blog post, we’ll guide you through the steps you can take to understand your rights, communicate with your employer, and explore alternative solutions to recover your hard-earned money.

Identifying What Your Company Owes You

First and foremost, it’s vital to identify what your employer owes you.

Understanding your employment contract is crucial in this regard, as it outlines your legal entitlements, such as bonuses, holiday pay, overtime, and commission payments.

Employers must ensure that they pay their employees for the time worked, as required by law.

Deductions, withholding of statutory pay, bonuses or other deduction for employee or employer contributions agreed upon in the contract are not allowed.

The three main components to consider when identifying what your company owes you are unpaid wages, underpayments, and deductions.

Noticing discrepancies in your pay can be disheartening, but taking the right steps to address these issues can help you ensure that you receive the money you are entitled to.

Unpaid Wages

An employer’s failure to pay wages may constitute a violation of the National Minimum Wage and National Living Wage regulations.

If you believe your employer may not fulfill your payment, considering legal advice may be beneficial.

In some cases, it may be prudent to consider resigning and obtaining legal counsel if your employer is consistently not paying you due to financial troubles.

Taking appropriate action is essential to protect and enforce your rights as a person and an employee.

Keep in mind that the statute of limitations for claiming owed money is six years, so it’s crucial to act promptly and decisively if you’re facing unpaid wages.

Underpayments

Underpayments can occur if you haven’t been paid for all the hours you’ve worked, including relevant entitlements.

If you suspect that you have been underpaid by your employer, it’s essential to review your paylip for any discrepancies and confirm that you have been compensated for all hours worked.

If you’re uncertain about your pay, request clarification from your employer or payroll department on how they have calculated your pay.

Familiarising yourself with the National Minimum Wage and National Living Wage can also help you understand if you’re being paid less than the legal requirement.

Deductions and Entitlements

Employers are allowed to deduct tax, National Insurance, and pension contributions from an employee’s pay.

However, if you suspect that your employer has made deductions from your final pay that exceed what is legally allowed, you may wish to consider filing a claim against them at an employment tribunal.

To address any issues with deductions and entitlements, it’s crucial to check your paylip and ask your employer to explain any unclear deductions. If you still have concerns after discussing the matter with your employer, consulting an expert is recommended.

Communicating with Your Employer

Once you’ve identified what your employer owes you, the next step is to communicate with them to request payment and negotiate a payment plan if necessary.

It’s essential to maintain a professional and composed manner during these discussions to increase the likelihood of a favorable outcome.

Requesting Payment

When requesting payment from your employer, it’s crucial to create a clear and concise message that is polite and friendly.

You may decide to choose to send the business an email or direct letter reminder, ensuring to include a direct subject line and get straight to the point.

Be sure to ask what happened and how you can help the business find a solution.

If your employer fails to provide your final pay, it’s advisable to contact them to draw attention to the mistake.

Should the issue persist, you may consider negotiating a payment plan or exploring alternative solutions like mediation services or filing a claim with an employment tribunal.

Negotiating a Payment Plan

When negotiating a payment plan with your employer, it’s essential to clearly communicate your expectations and collaborate with them to reach an agreeable arrangement.

The ideal payment plan should offer a balance of advantages for both parties and be tailored to meet your individual needs while being adaptable to any changes in circumstances.

By constructing a compelling argument for a payment plan, you can demonstrate your worth to the organisation and present a strong case for being remunerated fairly.

Remember, establishing a payment plan is a cooperative process, so it’s crucial to work together with your employer to find a solution that benefits both parties.

Exploring Alternative Solutions

If communication with your employer fails to resolve the issue, you may need to explore alternative solutions, such as mediation services or employment tribunals.

These options can help you recover the money you’re owed without further damaging your professional relationship with your employer.

Mediation Services

Mediation services can provide a quicker and more cost-effective way to resolve debt disputes compared to court proceedings.

A mediator from a mediation service assists both parties in reaching an agreeable resolution to a disagreement.

Utilising a mediation service services can be particularly beneficial if you wish to preserve your professional relationship with your employer.

However, it’s important to note that if mediation fails to produce a successful outcome, you may still have the option to pursue legal proceedings in court.

While court action can be more costly and time-consuming, it may be necessary if other avenues have been exhausted.

Employment Tribunals

Employment tribunals are legal bodies responsible for resolving disputes between employees and employers regarding employment rights.

They serve as the primary forum for determining disputes between workers and employers and can be a valuable resource if your employer has not paid the amount due to you.

Keep in mind that there are strict deadlines for submitting claims at employment tribunals, so it’s crucial to act promptly.

Before filing a claim, consider reviewing what needs to be done and remember that filing an employment tribunal claim should be seen as a last resort, particularly if you intend to continue working with your current employer.

Legal Action and Debt Recovery

As a last resort, you may need to consider legal action and debt recovery to obtain the money you’re owed.

This can involve hiring a solicitor, initiating court proceedings, or engaging debt recovery agencies.

It’s essential to weigh the pros and cons of each option and seek professional advice if necessary.

Hiring a Solicitor

A solicitor can help you recover debt by composing a letter to the debtor for a fee, which can yield prompt results.

They can also assist in articulating your case in legal terms and recognising potential further action.

When hiring a solicitor, it’s important to find a qualified professional with expertise in the applicable laws, who can demonstrate effective communication and fee transparency.

The fee structure for a business engaging a solicitor may vary depending on the complexity of the dispute or case, but generally, they charge the business either a fixed fee or an hourly rate.

Be sure to discuss fees upfront to avoid any surprises down the line.

Court Proceedings

If your attempts to recover the money you’re owed have been unsuccessful, court proceedings may be your last resort.

Before initiating court action, it’s important to seek legal advice to understand the potential costs and outcomes associated with this option.

Keep in mind that if you win your case, you’ll have to apply to the Employment Judgments Office (EJO) to recover the money owed, which will incur further court fees.

This process can be lengthy and expensive, so it’s crucial to consider all your options before proceeding with court action.

Debt Recovery Agencies

Debt recovery agencies specialise in recovering debts and may employ solicitors to take legal action to recover them.

They charge a fee or percentage of the recovered amount, but it’s important to note that the personnel employed by debt recovery agencies may not be legally trained.

While the cost of using a debt recovery agency may seem like an appealing option, it’s important to weigh the potential risks and costs associated with this service.

Be sure to research the agency thoroughly and consider all your options before making a decision.

Protecting Yourself in the Future

To safeguard yourself from future issues with unpaid wages or underpayments, it’s vital to have a thorough understanding of your employment contract and regularly review your payslips.

By staying informed and proactive, you can ensure that you receive the money you’re entitled to and maintain a healthy professional relationship with your employer.

Understanding Your Employment Contract

In the UK, employees have a legal entitlement to a detailed paylip, which outlines the deductions and payments made to them.

If deductions or payments are missing or incorrect, it’s essential to contact your employer or HR team to address the issue.

If the problem persists, seeking outside counsel from a professional, such as AWH Solicitors, may be necessary.

Their employment law services are offered on a no-win, no fee basis, ensuring that you’re not burdened with any financial implications when initiating proceedings.

Regularly Reviewing Payslips

Regularly reviewing your payslips is crucial to ensure the accuracy of information and detect any mistakes.

By carefully checking your payslip, you can identify any errors and make sure that all the information is accurate, including your payments and deductions.

Maintaining paylips and reviewing them on a regular basis is essential to guarantee that all payments and deductions are accurate.

By staying on top of your finances and keeping a close eye on your payslips, you can prevent potential issues with unpaid wages or underpayments in the future.

Frequently Asked Questions

Can you go to the police if someone owes you money?

If someone owes you money, you can’t take the case to the police.

Generally speaking, they will not get involved with civil matters such as debts, and instead refer the dispute with whoever owes you money to other legal avenues, such as small claims court.

Therefore, it is best to seek other methods of resolving a business dispute over unpaid debt.

Can I get my money back without a contract?

Unfortunately, without a written contract, it may be difficult to get your money back.

You can try using any available evidence to demonstrate that a debt or money is owed.

However, if the other party disputes the amount they owe or denies they owe any debt or money at all, you may need to seek legal recourse.

How do I take legal action against a company for non payment?

Taking legal action for non-payment of debts owed against a person or a company can be done by making a court claim for the money you’re due.

This money you owe may include interest or compensation for assets owed to you.

Filing a court claim online may prompt payment from the company without having to proceed with further action in court.

Can I wind up a company that owes me money?

Yes, it is possible to apply to the county court, to wind up a loan from a company that owes deduct money or owe has owed you tax money.

However, it should be noted that this will likely result in the company no longer exist and, therefore, may not allow you to receive any repayment of money owed.

Summary

In conclusion, recovering unpaid wages from your employer may seem like a daunting task, but by understanding your rights and taking appropriate action, you can navigate the process effectively.

Whether through direct communication, mediation, tribunals, or legal action, it’s crucial to stand up for yourself to receive the money you’re entitled to.

Remember, you have the right to fair compensation for your hard work.

Don’t let unpaid wages and debts go unaddressed – take control of your financial situation and protect yourself for the future.

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