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Employment Status as a Director (Non-Trading Company)

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  • Employment Status as a Director (Non-Trading Company)

    Hi there,

    I've been putting some plans in place in case my current employer folds and I am made redundant. As a result, I set up a Limited Company about a week ago, mainly just to reserve the name, in case I decide to do anything with it in the future, e.g. contract work - I am the sole Director of that company; not trading, nothing... just set one up to reserve the name. My main plan is to find some employment elsewhere with another employer.

    One of the questions I can't seem to find an answer for surrounds my employment status if I am made redundant from my current employer? Just to be clear with the LTD company I set up; I am not trading, I have no contract of employment with my company, no funds are coming to me, I am not taking a salary/dividends... nothing. I just set up a company and paid £12 to do it last week, incorporate and reserve the name.

    I've read on GOV.UK that a 'Director' holds the position of 'Office Holder' - "Office holders are neither employees nor workers." Someone is likely to be an office holder if most of these statements apply to them: there is no contract or service agreement relating to their appointment (in my case, correct); their duties are minimal, and are only those required under the relevant statute, constitution or trust deed (correct); they don’t get a salary or any other form of regular payment for their services (correct!)

    I suppose my question is this... if I am made redundant from my current employer (where I serve purely as a worker/employee) is it possible for me to sign on, and claim JSA for unemployment - despite me being a Director of a company that doesn't trade, has no income and doesn't pay anything to the Director (me) and is just a company lying dormant? I'm neither employed or self-employed right? I'm technically unemployed still?

    If it will cause an issue, I suppose the best thing for me to do would be to dissolve the company asap, especially if I fear I may become redundant anytime soon, and I do not want to lose out on any short-term unemployment benefit / income protection benefit.

    Thanks for anyone's help in advance!
    Last edited by ashes; 6th October 2017, 16:29:PM.
    Tags: None

  • #2
    Re: Employment Status as a Director (Non-Trading Company)

    I believe the answer is yes a company director and shareholder of a limited company can claim JSA. However, you must meet the eligibility requirements and ongoing conditions required by the JSA scheme.
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