Single Shareholder Companies - Cases on Hold

In an effort to establish a definitive set of rules for deciding if and when a director who owns all the shares in a company can be treated as an employee for the purposes of Section 182 of the Employment Rights 1996, the Court of Appeal is considering a case in December which will provide guidance for a series of other cases brought before the tribunal. Until the case is hear, all similar cases are stayed.

S182 applies when the Government has to step in as statutory guarantor for certain categories of debts owed to employees, but unsatisfied on the insolvency of an employer. In the cases in point, the directors of the companies made claims against the Secretary of State after the companies they owned and ran became insolvent.