The Workers Rights 
Hundreds of employees were left with unpaid wages and holiday pay totalling £489,000 that the administration process failed to pay when BrewDog went under earlier this year. However, there is a safety net in UK employment law for just this eventuality. Employees were sent to the government’s Insolvency Service for the purpose of receiving statutory entitlements even if the employer has no money remaining. Here are some things to know if you are a UK employee in a similar situation.
Quick Facts
| Fact | Detail |
| Payments due to BrewDog staff | £489,000 of wages & holiday pay |
| Staff made redundant | 440 employees |
| Bars closed immediately | 38 UK locations |
| Who is responsible for paying unpaid wages? | The Insolvency Service was established by the UK Government’s (National Insurance Fund) resolution, which came into effect on 1 April 2005. |
| Max redundancy pay claim | Up to £643/week (capped statutory rate) |
| Claim deadline | The time frame is normally within 6 months of the date of insolvency. |
| Where to claim | gov.uk/claim-redundancy |
What Happened to BrewDog Workers?
The Scottish brewer went into administration with more than £500m owed, and 440 employees were laid off within a day. There wasn’t enough money in the company’s retail division to pay preferential creditors, which include yet-to-be-paid wages and holiday pay owed to BrewDog staff.
This is a scenario that is becoming more and more prevalent in insolvency proceedings in the UK. In a failed business, assets may be insufficient, and employees may find themselves at the bottom of a very long list (after secured lenders, HMRC and administrator fees).
The good news? That’s not the line UK workers are required to line up in.
What UK Employees Can Claim After a Company Goes Bust
If an employer goes bankrupt, it’s the government that intervenes under the Employment Rights Act 1996 via the National Insurance Fund (NIF) and the Redundancy Payments Service (RPS). This includes a range of types of unpaid benefits.
| What You Can Claim | Entitlement | What’s Covered | Cap |
| Unpaid wages | Up to 8 weeks arrears | £643/week max | |
| Unpaid holiday pay | Leave that can be earned up to 6 weeks a year. | £643/week max | |
| Statutory redundancy pay | This is based on the following factors: age, length of service, weekly pay. | £643/week max | |
| Notice pay | Statutory minimum notice period | £643/week max | |
| Unpaid pension contributions | Outstanding employer contributions | No set cap |
Please note: the maximum allowance is £643/week (2024–25 rate) and this is not a fixed amount based on your salary. High earners will likely not be reimbursed for the true value of their service.
How to Claim: Step by Step
The administration or liquidation of your company is relatively simple once it has been entered into by your employer:
- Be patient: The administrator (or liquidator) will reach out to you to inform you of the insolvency and options available.
- Obtain your RP1 or CN form: These will be provided by your RP1. RP1 is for redundancy pay; CN is for other payments such as wages and holiday pay.
- Make a claim online: Claims can be made using the government’s online portal at gov.uk/claim-redundancy. National Insurance number and work information will be required.
- Keep an eye on your claim: Claims are usually processed in 3-6 weeks with the Redundancy Payments Service.
- Collect large unsecured amounts: If the employer owes you more than the statutory limits, you will be an unsecured creditor for whatever is over that amount. In that case, it’s not going to happen – though it’s worth it to register.
BrewDog Workers vs. What UK Law Guarantees
Let’s look at how BrewDog employees’ rights align with the general rights of employees during insolvency:
| Scenario | BrewDog Workers | Typical UK Employee |
| Unpaid wages recovered | Through Government NIF scheme | Up to 8 weeks |
| Holiday pay recovered | Through government NIF scheme | Up to 6 weeks |
| Redundancy pay | Statutory amount only | Age/service based |
| The following will be paid as full salary arrears above the cap. | Not covered | Unsecured creditor |
| Crowdfunding investment | Shares now worthless | N/A |
Know Your Rights: Key Things UK Workers Often Miss
- Accrued but unused holiday is a recoverable right, not a workplace benefit – Many employees don’t know that unspent holiday is a claimable right, not just a benefit of being a member of the workforce.
- Redundancy – 2 years’ service – Statutory redundancy – Applies if you are employed by the employer for 2 years or more and you have been made redundant.
- Notice pay is not working notice – If dismissed immediately, then get statutory notice pay (1 week for every year of service, a max of 12 weeks).
- The clock is running – Most claims must be submitted within 6 months of the insolvency date! Don’t delay.
- Your claim is not dependent on the administration – You don’t have to wait until the administration is finished. The awards are made independently of the NIF.
FAQs: UK Employee Claims After Insolvency
If the workers of BrewDog were transferred over to the new owner, can they claim?
The 736 employees who became members of Tilray via the sale of the business are likely to maintain their employment rights under the TUPE rules, and they would not be required to file a claim for future wages under NIF. The NIF claims are for those who have been made redundant.
What happens if I have more than the minimum amount in my debt?
You may be able to register as an unsecured creditor for the amount in excess of the limit, and it is likely that you will recover pennies in the pound (or nothing at all).
How long does the Redundancy Payments Service take?
The majority of payments are made within 3-6 weeks after the application is complete. Some cases may be more complex and require more time.
Do zero-hours workers have the same rights?
The calculation of the entitlements for zero-hours workers is based on their average weekly earnings — which are lower and can vary.
The Bottom Line
The BrewDog debacle is a stark example of how even a popular employer can leave employees without a job. Funds owed to BrewDog employees of £489,000 were not recoverable via administration, but the UK’s statutory safety net will ensure that most of those workers won’t leave with nothing. Knowing what you have a right to, acting promptly and utilising the government’s Redundancy Payments Service are the best ways to claim what you are entitled to.
If you’re in a similar situation, take the initiative and reach out to the administrators. Submit your claim as soon as possible.
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