Will the employees get paid?

The Commonwealth Government provides an employee safety net for employees of failed businesses. The scheme is set out in the Fair Entitlements Guarantee Act 2012 (FEG Act) and seeks to provide a scheme of last resort for employees who have lost their employment as a result of their employer’s insolvency and are owed employee entitlements and the entitlements cannot be immediately paid by the appointed that are not able to be paid by the insolvency practitioner handling the insolvency of the employer.

The FEG scheme will pay out claims (limits apply) for the following entitlements:

  • Unpaid and underpaid wages (up to thirteen weeks)
  • Unpaid annual leave;
  • Unpaid long service leave;
  • Unpaid pay in lieu of notice (up to five weeks); and
  • Unpaid capped redundancy pay (up to four weeks per year of service).

The FEG Scheme does not pay out unpaid superannuation and employees should be aware that the scheme will not pay their entitlements if they resign after the insolvency practitioner handling the insolvency of the employer has been appointed.

Further information can be obtained through the FEG Hotline on 1300 135 040, or the FEG Mailbox at FEG@deewr.gov.au