The Compendium

Redundancy Payments Service

The role of the Redundancy Payments Service (RPS) is to meet redundancy and other employee payments when the employer cannot afford to do so. This is often the case when a company enters Liquidation and its employees no longer have a job.

The RPS is called upon by an Insolvency Practitioner, but can also be accessed by employers to help the company avoid insolvency. The RPS will need to be repaid over time but the financial assistance programme it offers may be the most affordable and least risky solution for employers to meet the extraordinary and immediate burden of redundancy pay.

In order to make a successful claim, either the employee or the Liquidator must satisfy the RPS that an employee is entitled to receive financial assistance. The information sent to it must include:

• Verification of wages/salary, such as PAYE submissions;
• Information about the employee(s) being made redundant, including their National Insurance Number(s), employment start and end dates, any notice date and their date(s) of birth.

If the RPS make a payment to the employee who would have otherwise had a claim in the insolvency, they are ‘subrogated’ into their position. This means they ‘stand in the shoes’ of the employee and can claim as a preferential creditor (for part of the amount paid) and an unsecured creditor for the balance.

[See ‘Insolvency Practitioner’, ‘PAYE’, ‘Subrogation’ and ‘Liquidation’.]

Registered Office

A registered office is the official address of a limited company, PLC or LLP.

Correspondence and legal notices from UK Government agencies are delivered there. It is also the address where a petition to compulsorily wind-up a company would be delivered.

A service address is the official contact address for individual directors, LLP members, company secretaries, subscribers, and People with Significant Control (PSC).