Section 183 — Insolvency.

(1) An employer has become insolvent for the purposes of this Part—

(a) where the employer is an individual, if (but only if) subsection [F1 (2), (4ZA) or (4A)] is satisfied, . . .

(b) where the employer is a company, if (but only if) subsection [F2 (3), (4ZA) or (4A)] is satisfied [F3 , ...]

(c) [F3 where the employer is a limited liability partnership, if (but only if) subsection [F4 (4), (4ZA) or (4A)] is satisfied.][F5 ; and]

(d) [F5 where the employer is not any of the above, if (but only if) subsection [F6 (4ZA) or (4A)] is satisfied.]

(2) This subsection is satisfied in the case of an employer who is an individual—

(a) in England and Wales if—

(ai) [F7 a moratorium period under a debt relief order applies in relation to him,]

(i) he has been [F8 made] bankrupt or has made a composition or arrangement with his creditors, or

(ii) he has died and his estate falls to be administered in accordance with an order under section 421 of the Insolvency Act 1986, and

(b) in Scotland if—

(i) sequestration of his estate has been awarded or he has executed a trust deed for his creditors or has entered into a composition contract, or

(ii) he has died and a judicial factor appointed under section 11A of the Judicial Factors (Scotland) Act 1889 is required by that section to divide his insolvent estate among his creditors.

(3) This subsection is satisfied in the case of an employer which is a company—

(a) if a winding up order . . . has been made, or a resolution for voluntary winding up has been passed, with respect to the company,

(aa) [F9 if the company is in administration for the purposes of the Insolvency Act 1986,]

(b) if a receiver or (in England and Wales only) a manager of the company’s undertaking has been duly appointed, or (in England and Wales only) possession has been taken, by or on behalf of the holders of any debentures secured by a floating charge, of any property of the company comprised in or subject to the charge, or

(c) if a voluntary arrangement proposed in the case of the company for the purposes of Part I of the Insolvency Act 1986 has been approved under that Part of that Act.

(4) [F10 This subsection is satisfied in the case of an employer which is a limited liability partnership—]

(a) [F10 if a winding-up order, an administration order or a determination for a voluntary winding-up has been made with respect to the limited liability partnership,]

(b) [F10 if a receiver or (in England and Wales only) a manager of the undertaking of the limited liability partnership has been duly appointed, or (in England and Wales only) possession has been taken, by or on behalf of the holders of any debentures secured by a floating charge, of any property of the limited liability partnership comprised in or subject to the charge, or]

(c) [F10 if a voluntary arrangement proposed in the case of the limited liability partnership for the purposes of Part I of the Insolvency Act 1986 has been approved under that Part of that Act.]

(4ZA) [F11 This subsection is satisfied in the case of an employer if—]

(a) [F11 the employer is a legal person,]

(b) [F11 a request has been made for the first opening of collective proceedings—]

(i) [F11 based on the insolvency of the employer, as provided for under the law of any part of the United Kingdom, and]

(ii) [F11 involving the partial or total divestment of the employer's assets and the appointment of a liquidator or a person performing a similar task, and]

(c) [F11 any of the following has decided to open the proceedings—]

(i) [F11 a court,]

(ii) [F11 a meeting of creditors, or]

(iii) [F11 the creditors by a decision procedure.]

(4A) [F12 This subsection is satisfied in the case of an employer if—]

(a) [F12 a request has been made for the first opening of collective proceedings—]

(i) [F12 based on the insolvency of the employer, as provided for under the laws, regulations and administrative provisions of a member State, and]

(ii) [F12 involving the partial or total divestment of the employer’s assets and the appointment of a liquidator or a person performing a similar task, and]

(b) [F12 the competent authority has—]

(i) [F12 decided to open the proceedings, or]

(ii) [F12 established that the employer’s undertaking or business has been definitively closed down and the available assets of the employer are insufficient to warrant the opening of the proceedings.]

(4B) [F12 For the purposes of [F13 this section]—]

(a) [F12 “liquidator or person performing a similar task” includes the official receiver or an administrator, trustee in bankruptcy, judicial factor, supervisor of a voluntary arrangement, or person performing a similar task,]

(b) [F12 “competent authority” includes—]

(i) [F12 a court,]

(ii) [F12 a meeting of creditors,]

(iii) [F12 a creditors’ committee,]

(iv) [F12 the creditors by a decision procedure, and]

(v) [F12 an authority of a member State empowered to open insolvency proceedings, to confirm the opening of such proceedings or to take decisions in the course of such proceedings.]

(4C) [F12 An employee may apply under section 182 (employee’s rights on insolvency of employer) only if he or she worked or habitually worked in England, Wales or Scotland in that employment to which the application relates.]

(5) [F14 In this section—]

(a) [F14 references to a company are to be read as including references to a charitable incorporated organisation, and]

(b) [F14 any reference to the Insolvency Act 1986 in relation to a company is to be read as including a reference to that Act as it applies to charitable incorporated organisations.]

Amendment notes

1. F1 Words in s. 183(1)(a) substituted (31.12.2020) by The Insolvency (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/146), reg. 1(3), Sch. para. 253(3)(a)(i) (with regs. 4, 5); 2020 c. 1, Sch. 5 para. 1(1)
2. F2 Words in s. 183(1)(b) substituted (31.12.2020) by The Insolvency (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/146), reg. 1(3), Sch. para. 253(3)(a)(ii) (with regs. 4, 5); 2020 c. 1, Sch. 5 para. 1(1)
3. F3 S. 183(1)(c) and word “and” immediately preceding it inserted (6.4.2001) by S.I. 2001/1090, reg. 5, Sch. 5 para. 19(1)(2)
4. F4 Words in s. 183(1)(c) substituted (31.12.2020) by The Insolvency (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/146), reg. 1(3), Sch. para. 253(3)(a)(iii) (with regs. 4, 5); 2020 c. 1, Sch. 5 para. 1(1)
5. F5 S. 183(1)(d) and word inserted (26.12.2017) by The Employment Rights Act 1996 and Pension Schemes Act 1993 (Amendment) Regulations 2017 (S.I. 2017/1205), regs. 1, 2(3)(a)(iv)
6. F6 Words in s. 183(1)(d) substituted (31.12.2020) by The Insolvency (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/146), reg. 1(3), Sch. para. 253(3)(a)(iv) (with regs. 4, 5); 2020 c. 1, Sch. 5 para. 1(1)
7. F7 S. 183(2)(ai) inserted (24.2.2009 for certain purposes otherwise 6.4.2009) by Tribunals, Courts and Enforcement Act 2007 (c. 15), ss. 108(3), 148(5), Sch. 20 para. 17; S.I. 2009/382, art. 2(a)(b)
8. F8 Word in s. 183(2)(a)(i) substituted (6.4.2016) by The Enterprise and Regulatory Reform Act 2013 (Consequential Amendments) (Bankruptcy) and the Small Business, Enterprise and Employment Act 2015 (Consequential Amendments) Regulations 2016 (S.I. 2016/481), reg. 1, Sch. 1 para. 18
9. F9 S. 183(3)(aa) inserted (15.9.2003) by Enterprise Act 2002 (c. 40), ss. 248, 278, Sch. 17 para. 49(3)(b) (with s. 249(1)-(3)); S.I. 2003/2093, art. 2(1) (subject to arts. 5-8) (as amended by S.I. 2003/3340, art. 2)
10. F10 S. 183(4) inserted (6.4.2001) by S.I. 2001/1090, reg. 5, Sch. 5 para. 19(1)(3)
11. F11 S. 183(4ZA) inserted (31.12.2020) by The Insolvency (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/146), reg. 1(3), Sch. para. 253(3)(b) (with regs. 4, 5); 2020 c. 1, Sch. 5 para. 1(1)
12. F12 S. 183(4A)-(4C) inserted (26.12.2017) by The Employment Rights Act 1996 and Pension Schemes Act 1993 (Amendment) Regulations 2017 (S.I. 2017/1205), regs. 1, 2(3)(b)
13. F13 Words in s. 183(4B) substituted (31.12.2020) by The Insolvency (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/146), reg. 1(3), Sch. para. 253(3)(c) (with regs. 4, 5); 2020 c. 1, Sch. 5 para. 1(1)
14. F14 S. 183(5) inserted (E.W.) (2.1.2013) by The Charitable Incorporated Organisations (Consequential Amendments) Order 2012 (S.I. 2012/3014), arts. 1, 4