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Dismissal in compulsory winding up

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA LW Exams › Dismissal in compulsory winding up

  • This topic has 5 replies, 2 voices, and was last updated 1 year ago by MikeLittle.
Viewing 6 posts - 1 through 6 (of 6 total)
  • Author
    Posts
  • August 18, 2023 at 6:31 am #690093
    whydoyoucare
    Participant
    • Topics: 50
    • Replies: 46
    • ☆☆

    Lupo has been employed by Snake Ltd for four years.
    He was aware that the company was experiencing trading difficulties but is still shocked to be sent home without notice when Snake Ltd is compulsorily wound up.
    He sues for wrongful dismissal but at the hearing the liquidator proves that he has discovered that Lupo has embezzled £20,000 from the company.
    Will Lupo be entitled to any compensation for his dismissal?

    Yes, he has been constructively dismissed
    Yes, he has been wrongfully dismissed without notice and no regard should be paid to the embezzlement discovered later
    No, the employment contract was frustrated by Snake Ltd’s liquidation
    No, Snake Ltd was justified in its dismissal of Lupo

    Answer is D.
    Questions
    1) The answer says it’s a wrongful dismissal and breach of contract but due to his conduct it’s considered justified dismissal.
    If he didn’t embezzle later, would it wrongful as it’s breach of contract because he was entitled to 4 weeks notice and redundancy pay and didn’t get?

    2)Also I know any unpaid wages and holiday pay are given to employees as preferential creditors, what about redundancy pay?

    3) in voluntary winding up contrary to compulsory winding up employees are not automatically dismissed, if however they are dismissed are they entitiled to redundancy and notice?

    August 18, 2023 at 11:21 am #690155
    whydoyoucare
    Participant
    • Topics: 50
    • Replies: 46
    • ☆☆

    Bump

    August 18, 2023 at 8:14 pm #690198
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23327
    • ☆☆☆☆☆

    I don’t understand this in your post … ‘If he didn’t embezzle later, … ‘

    Whatever, he DID embezzle and this makes his dismissal justified.

    Redundancy pay is not identified as a preferential debt.

    Dependent on the country and its jurisdiction, generally employees are entitled to notice and to redundancy

    OK?

    August 18, 2023 at 8:14 pm #690199
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23327
    • ☆☆☆☆☆

    What do you mean ‘Bump’?

    August 18, 2023 at 10:38 pm #690213
    whydoyoucare
    Participant
    • Topics: 50
    • Replies: 46
    • ☆☆

    He didn’t embezzle later – he didn’t commit the wrong of 200000 from the company. Would it be wrongful and breach of contract then?

    August 19, 2023 at 8:26 am #690233
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23327
    • ☆☆☆☆☆

    I’m still not sure what it is that you are asking!

    However, I believe that you are asking whether Lupo would have been entitled to a redundancy payment and 4 weeks notice?

    If this is your question then, yes. He should have been entitled to 4 weeks’ notice and redundancy pay

    OK?

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