My employer is insolvent and owes me wages.

What the Law Says

The Payment of Wages Act 1991 does not directly govern insolvency claims, but it underpins the principle that wages must be paid as agreed — and when an employer cannot pay due to insolvency, the State provides a safety net via the Insolvency Payments Scheme (administered by the Department of Enterprise, Trade and Employment). While the Act itself doesn’t create the scheme, section 5 confirms that deductions from wages are only lawful in specific circumstances — meaning unpaid wages remain a legal debt owed to you.

When your employer becomes insolvent (e.g., goes into liquidation or receivership), you become an unsecured creditor. However, Irish law gives employees priority for certain unpaid entitlements through the Insolvency Payments Scheme.

This scheme covers unpaid wages, holiday pay, sick pay (if contractually due), and statutory redundancy payments — but only up to set limits and for work done before the insolvency date.

You must apply within 6 months of the insolvency event (e.g., appointment of liquidator) — missing this deadline generally means you lose your right to claim from the fund.

Statutory Text

An employer shall not make any deduction from the wages of a worker unless— (a) the deduction is required or authorised by statute, (b) the deduction is authorised by the worker's contract of employment, or (c) the worker has given prior written consent to the deduction.

— Payment of Wages Act 1991, s. 5 — Deductions from wages

What to Do

Sources