RAAs are a statutory restructuring mechanism which operate by apportioning the departing employer’s share of liability between it and remaining employers. As an RAA can be entered before the insolvency process is initiated, RAAs can permit corporate restructuring in response to financial hardship without triggering the departing employer’s insolvency.

1. Talk to your contracting partners about any difficulties that have arisen or that you anticipate might arise. Everyone knows that unanticipated issues are going to get in the way of normal business. So address them head on. Pretending that they don't exist isn't going to be of any help to you or your business partners.
2. If you are struggling financially take advantage of the government support. Our website provides guidance on how to access that support. Speak to your bank. The risk to banks is significantly mitigated by the government guarantee.

Under Finance Bill 2020, HMRC will move up the insolvency order of hierarchy from unsecured creditor to secondary preferential creditor status in respect of:

If you have a pending Winding Up Petition at this time, or were contemplating issuing one, this note looks at how the courts are dealing with Petitions in light of the recent government guidance to the public and practice directions for the legal professions.

Those who are familiar with the general winding up list will recognise that a weekly court with multiple barristers, solicitors, company directors, court staff and an Insolvency and Companies Court Judge – often totalling in excess of 50 people is clearly not consistent with current social distancing guidelines.

In these unusual times, Hardwicke is open for business as usual and here to help you and your clients with the multiple issues that may arise out of the current economic conditions. This information update is to help keep you up to date with developments and to share our insight in response to the developments our country is going through at this unprecedented time.

We will be providing regular information to keep you up to date. This update covers:

There have been increasing concerns in recent weeks that UK insolvency law does not accommodate the short-term impact of COVID-19 on many businesses.  In response, the Business Secretary announced on 28 March that the UK's insolvency rules would be amended as part of the Government's wider business support package.  Whilst the measures that the Government intends to implement have not yet been fully detailed, this note summarises what has been announced so far and what we might expect, based on the Business Secretary's comments.

Since the beginning of March, the UK has seen various high profile company failures as a result (at least in part) of COVID-19. Flybe and Laura Ashley may be the first of many businesses unable to react and adapt to the unprecedented challenges.

Midlothian Council v Raeburn Drilling and Geotechnical Limited & Others

Businesses will be considering dramatic changes over the next few days and weeks. The Government last week closed certain business such as pubs, theatres, restaurants and cinemas. Last night, the Government went further and ordered that all non-essential retail businesses and hotels should close and that people should not leave their homes to work unless it absolutely cannot be done from home.