Updated: October 2016
Words you may need to know
Based on – when something is used as a starting point (here for the Insolvency Benefit amount)
Formal - official
Insolvent – generally a person or company is insolvent when they owe money (have a debt) that they cannot pay (but see website)
Proportion – a part of something; a share
Statutory - something provided by law (eg see below, holiday pay)
What is Insolvency Benefit?
Insolvency Benefit was introduced on 1st December 2012. Its purpose is to provide employees with financial help if their employment ends because their employer has become insolvent.
Note: The employer must have become insolvent after 1st December 2012 for the rules to apply.
Full details are available on the Social Security Department’s website:
The way the benefit works
A formal insolvency procedure (see website) must have been started before Insolvency Benefit can be applied for.
In addition, to qualify for Insolvency Benefit, a number of conditions must be satisfied by the employee. ( see website).
How is Insolvency Benefit calculated?
The amount of Insolvency Benefit that an employee might receive is based on a set proportion of money that is owed to them by their employer. This includes any money due for unpaid wages, holiday pay, statutory notice pay and statutory redundancy pay. (For full details see the website).
The maximum amount currently payable in Insolvency Benefit is £10,000.
How to apply
A claim form for Insolvency Benefit is available from the Social Security Department.
You can contact the Social Security Department for more information:
Social Security Department, Philip Le Feuvre House, La Motte Street, St Helier.
Telephone: 01534 445505
Fax: 01534 445525
Opening hours: Monday to Friday, 8.30am to 5pm