Updated 3 September 2020
COVID-19 has impacted employees and their business across Australia. Some businesses have struggled to stay afloat, and this can affect their ability to pay their employees what they are owed. As a result of cashflow issues, some business may be forced to close down and liquidate in order to settle their debts. If your employer is already deregistered, there may still be steps you can take as an employee to make sure you get the payments you are owed.
If you don’t know whether your employer is deregistered, you should have a look at our resource on “Pursuing an employer for payment when they are no longer trading”.
This resource is for employees who are owed payments from their employer, and that employer is now deregistered as a company. It includes information about:
Is this resource for me?
This resource is written for you if you answer yes to all of the following questions:
I am an employee
My employer is a company
My employer is deregistered
I am owed payment from my employer
If your employer is liquidated, you may be able to recover some of your unpaid employment entitlements by making a claim with FEG.
Liquidation means that the employer company’s assets have been sold off to settle their debts, and they no longer have any assets with which to settle the debt they owe you. In most situations, companies that are deregistered will be liquidated.
FEG is a last resort scheme available to eligible employees to claim unpaid employment entitlements in one of the following situations:
If your FEG claim is successful, the Federal Government will pay some of the entitlements owed to you by your former employer.
This could include:
Not everyone is eligible to make a claim with FEG. To qualify for FEG assistance you must meet the following criteria:
If your situation does not meet all of the above criteria, you will have to explore whether there are other avenues available to you recover any unpaid entitlements owed to you. You can start by looking at our section below on “What do I do if I’m not entitled to apply for FEG assistance?”.
Am I an employee?
You must be an employee in order to seek assistance from FEG. You will likely be considered an employee if:
If you are a contractor, you will not be eligible for assistance from FEG.
To find out what the difference is between a contractor and an employee, you can have a look at information published by the Australian Tax Office.
If you are unsure whether you were a contractor or an employee, you can ask us directly on Justice Connect Answers.
If you are sure you were an employee, but your paperwork says that you were a contractor, you should get legal advice about what you should do next. You can apply for assistance from our Federal Self Representation Service.
Please note that Justice Connect Answers can only help with quick legal questions, and does not qualify as an application for comprehensive legal help. If you need ongoing legal help with your problem, the best thing to do is submit an online application.
Am I eligible?
You are eligible to seek assistance from FEG if you fulfil all of the following descriptions at the time you lost your job:
You must make an application for FEG assistance within 12 months of either a liquidator being appointed to your employer or the date you lost your job.
For more information about how to apply for FEG assistance, please have a look at the information published on the Australian Government Attorney General’s Department website.
You may not be entitled to apply for FEG assistance if:
In these situations, you will have to consider your next steps carefully. The following information will walk you through the options you have. Please note that some of these options are complex, and we recommend that you seek legal advice before taking any action.
As an employee, you may be entitled to recover unpaid entitlements from your employer’s insurance company if they have deregistered.
To find out whether you have such an entitlement, you can consider:
If you are unable to recover unpaid entitlements through FEG or from your employer’s insurer, you will have to consider whether you need to reinstate your employer’s company so that you can commence legal proceedings against them.
You should consider whether it is worth your efforts to reinstate your employer’s company before you take any steps.
The effect of reinstatement is:
In the context of a company that has stopped trading due to insolvency, it may not be worth your time and efforts to have them be reinstated. This is because they may not have assets available to pay you, even if you are ultimately successful in obtaining an order that they pay you your entitlements.
We strongly recommend that you seek legal advice if you wish to consider whether you wish to reinstate your employer’s company. You can apply for assistance from our Federal Self Representation Service.
There are two ways you can follow to reinstate your employer’s company.
Option 1 – Apply to ASIC
As an employee, you can only apply to the Australian Securities and Investments Commission (ASIC) to reinstate your employer’s company status if you had already started legal proceedings against them before they were deregistered.
ASIC has published information on how you could apply to them for reinstatement of a company, under the subheading “How to apply for reinstatement as a third party”.
Option 2 – Obtain a court order
If you have not commenced legal proceedings against your employer before they were deregistered, your only option to reinstate a company is to obtain a court order that ASIC reinstate the registration of the company.
This is a complex process that will take time, money and effort. Depending on the facts of your specific case, reinstatement of your employer’s company may not be worth your time or money.
We strongly recommend you seek legal advice before taking this action. You can apply for assistance from our Federal Self Representation Service.
What happens after my employer’s company is reinstated?
If you are successful in reinstating your employer’s company, you will still have to make a claim against the company as you normally would.
Temporary supports are available to help people affected by COVID 19, including:
These resources contain information about steps you could could take if you lose your income because of COVID-19:
You can find more helpful resources to help you understand your rights and solve legal problems by following the links below: