Part VII Insolvency of employers

Chapter II Payment by Secretary of State of unpaid scheme contributions

I1C1123 Interpretation of Chapter II.

1

For the purposes of this Chapter, an employer shall be taken to be insolvent if, but only if, in England and Wales—

a

he has been adjudged bankrupt or has made a composition or arrangement with his creditors;

b

he has died and his estate falls to be administered in accordance with an order under section 421 of the M1Insolvency Act 1986; or

c

where the employer is a company—

i

a winding-up order F2... is made or a resolution for voluntary winding up is passed with respect to it F3or the company enters administration,

ii

a receiver or manager of its undertaking is duly appointed,

iii

possession is taken, by or on behalf of the holders of any debentures secured by a floating charge, of any property of the company comprised in or subject to the charge, or

iv

a voluntary arrangement proposed for the purpose of Part I of the M1Insolvency Act 1986 is approved under that Part.

2

For the purposes of this Chapter, an employer shall be taken to be insolvent if, but only if, in Scotland—

a

sequestration of his estate is awarded or he executes a trust deed for his creditors or enters into a composition contract;

b

he has died and a judicial factor appointed under section 11A of the M2Judicial Factors (Scotland) Act 1889 is required by that section to divide his insolvent estate among his creditors; or

c

where the employer is a company—

i

a winding-up order F4... is made or a resolution for voluntary winding up is passed with respect to it F5or the company enters administration,

ii

a receiver of its undertaking is duly appointed, or

iii

a voluntary arrangement proposed for the purpose of Part I of the M1Insolvency Act 1986 is approved under that Part.

3

In this Chapter—

  • “contract of employment”, “employee”, “employer” and “employment” and other expressions which are defined in F1the Employment Rights Act 1996 have the same meaning as in that Act;

  • “holiday pay” means—

    1. a

      pay in respect of holiday actually taken; or

    2. b

      any accrued holiday pay which under the employee’s contract of employment would in the ordinary course have become payable to him in respect of the period of a holiday if his employment with the employer had continued until he became entitled to a holiday;

  • F6...

F74

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5

Any reference in this Chapter to the resources of a scheme is a reference to the funds out of which the benefits provided by the scheme are from time to time payable.