When an Employee Dies

Occasionally we are asked what to do when an employee dies and monies are owing for wages or entitlements. For long term employees this can be substantial with long service and other leave entitlements payable.

The usual situation is that an estate’s assets are frozen until such time as probate is granted which means the will has been approved by the court and the executor can then collect the assets. This means the employer will be asked to pay the amount owing the employee to the executor’s legal representative, and the executor can then distribute bequests accordingly.

It is unwise to just pay the entitlements to the employee’s bank account as this may be accessed by non-beneficiaries. The employer would then be liable for the monies that were otherwise payable to someone else.

If the estate is small there may be no need for the executor to seek probate. In that case you should ask the executor’s legal representative to advise you what is to happen to the entitlements and if necessary, pay them to the solicitor’s trust account.

Obviously, all matters are different. You should seek advice before doing anything with the monies payable to the employee.