As regular readers of our articles will be aware we have long campaigned for clarity and guidance in terms of who can assist a director or employee to make a claim to the Redundancy Payments Service. RCUK has been in regular communication with both the Financial Conduct Authority and the Insolvency Service in the last 12 months and welcome the publication of Dear IP Article 111.
For your assistance we have summarised the guidance below.
Engaging in a regulated activity whilst neither authorised nor an exempt person is a criminal offence under section 23 of the Financial Services and Markets Act 2000 (FSMA).
Assisting a client in relation to a claim to the Redundancy Payment Services is a regulated activity as set out in The Financial Services and Markets Act 2000 (Claims Management Activity) Order 2018 and the FCA Handbook.
How to remain exempt from FCA regulation
Do not undertake any of the above regulated activities.
What can you do
Insolvency practitioners are not providing a regulated activity if they simply highlight the existence of the Redundancy Payments Service and recommend using the services of an authorised CMC, named or otherwise.
To refer work to an authorized CMC and remain exempt you must meet the below requirements
IPs may also claim exemption from authorisation under 89V The Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 if the IP meets all the criteria below.
The IP (or other firms):
We would also remind IPs (and other firms) that whilst Section 327(9) of FSMA does provide that member of a designated professional body can rely upon the exemption from needing FCA authorisation for some FCA services, Part XX states that this is not applicable when carrying out regulated claims management activities. Therefore, being a licensed IP or a chartered accountant are not grounds for exemption to provide regulated claims management services.
Similarly, Insolvency Practitioners and other bodies already authorised by the FCA for other regulated services, for example debt management, still require specific FCA authorisation to provide regulated claims management services.
RCUK carry out stringent tests and due diligence in relation to any IP that they work with on a stakeholder basis. We also have full compliance processes in place to ensure that both we and the IP operate in accordance with relevant data protection legislation, including the General Data Protection Regulation (GDPR) and the Privacy and Electronic Communications Regulations (PECR).
If you would like any further advice or assistance as to how you can ensure that your business does not commit a criminal offence or you would like any information as to how RCUK may assist your business or your clients in the field of director redundancy claims, please call our Directors, Andrew Read or Gary Addison on 01625 462587 or email them at [email protected] or [email protected].
Further information on how to operate compliantly can also be found at https://www.redundancyclaim.co.uk/for-professionals/introducer-compliance-guidance.
Does accepting a new job offer before the date of redundancy prevent a director making a claim for redundancy to the RPS
If you are looking to close your limited company, you may have attempted to strike it off by submitting a DS01 form to Companies House. This process is also sometimes referred to as dissolving or company dissolution.
A Creditors’ Voluntary Liquidation (CVL) is an official procedure whereby a company’s assets are liquidated in order to pay creditors. It’s typically initiated by directors when their company becomes insolvent and there is no hope of business recovery.
May I take this opportunity to thank you and your team for all your professional help in securing for myself and my wife, redundancy pay. I would have no hesitation in recommending RCUK to assist them.Tom Harrison Managing Director of a construction company