Former staff of recently folded adoption charity BAAF have still not received redundancy payments and fear they might not receive them at all, according to a letter sent by 43 ex-employees to the Redundancy Payment Services.

The British Association for Adopting and Fostering folded on 31 July, with the loss of 71 jobs. Some 50 staff were told they faced redundancy with immediate effect, with the remainder transfering to the charity Coram.

A letter sent by former staff to the Insolvency Service today reveals that staff were told by BAAF it "could not meet redundancy payments or payments in lieu of notice [PILON]". As an alternative, they were advised to apply for statutory redundancy pay – capped at £475 for each week of service – which they were informed would involve a “simple online process” taking no longer than six weeks.

Statutory redundancy is provided by the Redundancy Payment Service (RPS), part of the Insolvency Service.

But today staff say they have still not received either redundancy payment or news of when they will be paid, according to the letter. 

The 43 former BAAF staff said: “The Insolvency Service has confirmed that there is an ongoing investigation into the sale and transfer of part of BAAF’s business to CoramBAAF and that this could have a serious impact on these claims,” the letter says.

“We believe that [BAAF administrator] Smith & Williamson are in discussion with the Insolvency Service in relation to specific details surrounding the sale of certain services to Coram and that in the meantime, all redundancy and PILON payments to former BAAF staff will be delayed, with a possibility that the Insolvency Service may reject these claims.”

'Extreme financial pressure'

The former staff said the period since the charity’s collapse has been “an incredibly difficult time”.

The letter states: “On 31st July, those employees were told that the salary payment made to them in July 2015 was their last from BAAF and that they were redundant with immediate effect and without notice.

“In the absence of any income since July, a number of former staff are now facing extreme financial pressure such as rent, mortgage payments and supporting their families. This matter therefore needs to be resolved swiftly and satisfactorily.

"If there is an ongoing dispute as to whether the RPS or BAAF (now CoramBAAF) is responsible for redundancy payments, we urge the Insolvency Service to take this up directly with Coram and in the meantime, to make redundancy payments to staff as soon as possible.”

A spokesperson for the former charity told Civil Society News that staff have had little response by the Insolvency Service to inquiries about redundancy pay.

One former staff member said: “I was told that they are still making further investigation regarding our case as the company was transferred to another charity.

"[The Insolvency Service advisor] said that there is a possibility that they might not be able to pay in which case we would have to go to the employment tribunal. She indicated that our case is far from straightforward.

“I guess it is not uncommon to transfer parts of one business to another to avoid paying redundancies. I do think that before taking on a charity, one takes on the obligations of that organisation into the consideration. I think it is highly immoral (but possibly legal) to take on the profitable parts but discard everything else without consideration for service users, staff and any other creditors or interested parties.”

Another former staff member who is currently eight months pregnant, said she was told by an advisor at the Insolvency Service it was “still making enquiries about the case” and was “investigating” the “possible transfer of business”.

The staff member said she was informed that “if the Insolvency Service decide they are not liable then it's Coram who is liable”.

“But if Coram don't pay us then we have to take them to employment tribunal. I can't believe it. Could we actually get nothing at the end of all this? I'm beginning to think so.”

The Insolvency Service was approached by Civil Society News for comment but did not respond by the time of going to press.