How to Recover Unpaid Wages
How to Recover Unpaid Wages
It can be a stressful situation if someone owes you money, particularly if that someone is a previous employer.
Many people leave jobs and have issues with their final wages, and since the Covid 19 pandemic began it has been even more commonplace.
With this in mind, many people are unsure of what to do when they have unpaid wages from a previous employer.
Unpaid wages can hang over them, and they do not always know where to turn to ease the burden.
Being owed unpaid wages from a previous employer is a common occurrence, but you can resolve it with a short conversation.
There are unusual times when a previous employer chooses to withhold unpaid wages.
If you are owed money from a previous employer, you will need to action whatever the scenario is.
In this article, our debt collection experts will explain what your options will be if you have unpaid wages from a previous employer.
Recovering Unpaid Wages from a Previous Employer
If someone has not paid you money when it was due, it is important to recover it.
You should remember that there may be a genuine reason why you were not paid.
For example, it could be a simple administration error, which could be resolved with a short, polite phone call.
Several scenarios may have happened.
Situations can be different depending on whether you are on the company’s payroll or are self-employed.
At Frontline Collections, we handle a lot of cases that involve unpaid wages.
As such, we can say that the options for an ex-employee to recover unpaid wages can also vary depending on the situation.
No two cases are alike, and each one must be taken on its own merits.
It is worth pointing out that the recovery of wages can work in both ways.
For example, payroll errors may occur that result in an overpayment of wages to employees.
If this happens, the employer is within their rights to request the return of the money.
Unpaid Wages – Employed Through Payroll
For those who were on the payroll of their previous employer, there are several pieces of information you should be aware of.
You should consider these points before escalating the matter to a debt collection agency.
For example, your employer must make statutory deductions from your wages for things such as government taxation.
These include things such as National Insurance (NI) tax, student loans, pensions or deductions for a court order.
These deductions might make your wages less than expected.
Other things might mean your wage is less than expected, such as unpaid holiday pay…
…Statutory Sick Pay (SSP) & Statutory Maternity Pay (SMP).
There may also be terms within your contract of employment that enables an employer to make allowances.
This could be for training provided by a third party, or tools provided to you which they have allowed you to keep.
If you are sure that you are owed money by a previous employer that is withholding money from you…
…then it is always best to contact them to discuss the matter.
If you choose to do this, make sure you maintain a polite and professional tone and have all documentation ready for the conversation.
You should have received your final payslip from your ex-employer when you left.
This will have details of any appropriate deductions made to your pay.
Your previous employer is legally obligated to provide you with these.
Should your previous employer fail to respond to your attempts at engagement…
…then it is appropriate for you to raise a written grievance, detailing your complaint.
You should always sign and date this.
You should also send it via recorded delivery so you have proof that they have received it.
If you need to escalate the matter then you should be able to submit a claim to an employment tribunal.
You can find more information about this on the Citizens Advice Website ‘Problems getting paid’.
This is ideal for people who have are owed money from a previous employer.
Unpaid Wages – Self Employed or Freelancer
For those who are self-employed, you may perceive that collecting unpaid wages is a more complicated task.
This is not true, and there are always good options available for those that are owed money from a previous employer.
As with those people who are on a company’s payroll, there may be a valid reason why your ex-employer has paid you less than you were expecting.
For example, if you are a builder your employer may have made a deduction against the Construction Industry Scheme (CIS).
These deductions count as advance payments towards the subcontractor’s tax.
It can also be for National insurance.
Contractors need to register for this scheme.
Subcontractors do not have to but face a high rate.
If you are sure that your previous employer has not paid you as you expected, and know that they have taken no other deductions from your payment…
…you should attempt the following action.
Establish the Facts
Before you speak to the company that owes you money, you should check your contract.
You should look for the agreed rate of payment in the ‘payment terms’ document was.
You should never carry out work without a document which details the terms of your agreement.
This document is critical to be able to understand all the terms and conditions within that said contract.
This applies to both self-employed and Freelance services provided.
Unpaid Wages – First Choice Solution for Debt Recovery
In the vast majority of cases, the steps we have outlined above can resolve and payment issues.
There will always be times where a former employer will seek to withhold money they owe you.
Some will take great measures to avoid making any kind of payment.
If this does happen, recovering the money can be a straightforward exercise.
This is true whatever the case may be, such as unpaid wages, overtime or a bonus that your former employer owes you.
One key asset to remember to get all appropriate documentation ready.
This could be a contract, payslips or payment terms.
If you have this, then there is help available without the need for expensive legal recourse.
Frontline Collection has helped those who are owed money from a previous employer since 2005.
Over our long history, we have recovered millions of pounds worth of unpaid wages.
For help with your debt, speak to one of our friend debt collection experts today.