What is the date of dismissal for Working Tax Credit purposes, when an employee has illegally been given less than their contractual notice?

Hello

I have a client who was dismissed without notice and given pay in lieu of notice instead.  They were paid the four week run on by the Tax Credit’s department, starting from the date that they were dismissed, before the Working Tax Credit claim was terminated.  The client then found another job about six weeks after they had been dismissed.  However, the Working Tax Credit run on had finished and the client does not meet the criteria for Universal Credit (but still would for Working Tax Credit).  They do not meet any of the usual exceptions to make a new claim for Working Tax Credit EG being in receipt of the Severe Disability Premium.

However, the client is now suing their former employer and their lawyer has told them that their former employer had acted illegally by not giving them their contractual notice (even though lieu in pay of notice was paid instead) and that for the purposes of unfair dismissal, their employment will be regarded as ending as when it would have if they had been given their contractual notice.  Can we argue that for Working Tax Credit purposes they should be treated as having been in work up until the period where their contractual notice should have been up to?  I have tried looking at The Working Tax Credit (Entitlement and Maximum Rate) Regulations 2002, Regulations 4, 5, 6, 7 and 8 but there does not seem to be a specific reference to this situation.  The regulations can be found here:- https://www.legislation.gov.uk/uksi/2002/2005/content.

Thanks

I don’t think so. The employer is in breach of contract, and for that reason the employee is entitled to any advantage they would have received had they worked their notice period. That is why, for the purposes of unfair dismissal, their employment will be regarded as ending after contractual notice. This doesn’t help for WTC though. I suppose there may be a possibility of including the loss of WTC in any claim for damages from the employer, but it probably wouldn’t pass the remoteness test. They should speak to their lawyer about this.

If they anyway don’t have entitlement to UC, it may be worth pursuing a new claim for WTC based on the loophole seemingly allowing fresh claims for a tax credit in cases where there was entitlement to that tax credit the previous tax year. There are a few threads about this on Rightsnet.