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What next for Wilko employees as chain goes into administration?

View profile for Adam Pennington
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What next for Wilko employees as chain goes into administration?

Wilko has been a mainstay on the high street for decades and this announcement will come as a hammer blow for all its 12,000 employees.

For those affected, either in stores, head office or in Wilko’s distribution warehouses, they should be given clear communication about what action is now being taken. A business falling into administration does not automatically terminate an employee’s contract, steps will now be taken by administrators to establish the appropriate course of action and the impact this will have on staff.

Typically, there is a 14-day window in which an administrator takes these decisions. If staff are made redundant during the first 14 days of administration, they will be entitled to arrears in pay and a redundancy payment if they are eligible – they will also be known as ‘ordinary creditors’. This means they are towards the bottom of the list when it comes to the company paying any money owed. If employees continue to work for the company beyond 14 days, administrators will take responsibility for their employment rights. They will also become ‘preferential creditors’, which essentially moves them up the hierarchy of creditors and they stand a more realistic prospect of recovering any money which is owed to them.