Insolvency Protection Directive 2008


The Insolvency Protection Directive is an EU Directive concerning the protection of employees in the event of insolvency of an employer. It replaced Directive 80/987/EC and 2002/74/EC in turn.

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The recitals of the Directive state its purpose is the protection of employees, in the interests of ‘balanced economic and social development’. It makes reference to the Charter of Social Rights for Workers 1989. In particular, recital 8 contains a declaration of the law’s ‘social purpose’.
In the United Kingdom, the relevant implementing legislation is found in the Employment Rights Act 1996. Under section 166 any employee may lodge a claim with the National Insurance Fund for outstanding wages.
In Italy, the Directive gave rise to Francovich v Italy on the principle of member state liability for non-implementation of EU law.