What happens to my entitlements once my employer goes into liquidation?
Your unpaid entitlements rank as a priority claim in the liquidation ahead of the claims of unsecured creditors.
If there are sufficient assets and subject to the rights of any secured creditors and the costs of the liquidation, employee entitlements are paid first in the following order:
- Wages and superannuation (equal ranking)
- Annual leave and long service leave
- Redundancy and payment in lieu of notice
What happens to my unpaid superannuation?
Again, if there are sufficient assets and subject to the rights of any secured creditors and the costs of the liquidation, unpaid superannuation is afforded and equal ranking with unpaid wages, in priority to other entitlements and the claims of unsecured creditors.
The Liquidator will endeavor to calculate your unpaid superannuation and advise the Australian Taxation Office (“ATO”) of how much is owing to you based on the records of the company.
If and when a dividend is declared by the Liquidator, your superannuation is paid to the ATO who in turn forwards the funds to your nominated superannuation fund.
How do I lodge my claim against the company?
The Liquidator will have provided you with a Formal Proof of Debt form that can be used to lodge your claim. You are encouraged to provide supporting documentation, such as pay slips, to substantiate your claim.
Please visit the ‘Current Administrations’ tab to obtain a fresh Formal Proof of Debt form.
What if there are insufficient assets to pay out my entitlements?
In the event that there are insufficient assets in the company to pay out your entitlements, the Fair Entitlements Guarantee (“FEG”), operated by the Department of Employment, may be accessed once the company is in liquidation, to address your unpaid entitlements (not including superannuation).
Where can I get information about the Fair Entitlements Guarantee?
Visit the FEG website at www.employment.gov.au/fair-entitlements-guarantee-feg.
For a listing of fact sheets, please click this link: FEG – Fact Sheets
Where can I get a copy of my PAYG Payment Summary?
Your employer is responsible for the preparation of your PAYG Payment Summary up to the date that the Liquidator was appointed.
If the company prepared your PAYG Payment Summary and you have misplaced yours, please contact the Liquidator to obtain another copy.
If the Liquidator engaged with you during the liquidation period and paid you wages, the Liquidator will provide you with a PAYG Payment Summary for the liquidation period.
Will I be penalized if the company did not pay the PAYG-w withheld from my wages to the ATO?
No, you will not be penalized or asked to pay additional tax as a result of your employer not paying the PAYG-w on your behalf.