It might get saved - it might collapse.

Either way, Lehman Brothers employees cannot afford to stand around Canary Wharf waiting to unpack their cardboard boxes, say the experts at Fox Williams.

1. Protect you and your family – if you are no longer employed, or you are but your employer is insolvent then benefits such as medical, permanent health and life insurance will cease, so get yourself and your family covered.

2. Don’t leave the country - if you are not an European Economic Area national and do not have the permanent right to live and work in the UK you may not be allowed re-entry if you leave. Get your immigration position checked and sorted out before you escape the City to recover.

3.Check your status – have you been fired or not? This will determine what rights, if any you may have for compensation. Your employer’s insolvency does not automatically end your employment unless the employer is in compulsory liquidation. Lehman is in administration, so unless expressly fired you are likely still to be employed. Tempting as it may be simply not to turn up at the office, go in unless told otherwise to avoid being fired for misconduct and losing the possibility that your contract may be adopted by the administrators.

4. Keep calm – in most cases the administrator will need some key staff to continue working to help sort out the mess. If you are selected to come back to work - and the administrator will make this decision during the first 14 days of his appointment - you will be paid salary, holiday and sick pay, as a matter of priority. Defacing the chief executive’s picture may seem tempting, but is unlikely to put you top of the administrators’ list of key staff they need to keep on.

5. Be prepared for the unexpected – Just because an administrator is appointed does not necessarily mean that all the underlying businesses will be shut down. Indeed, several rivals have been sniffing around Lehman’s carcass and Nomura has already agreed to buy a substantial chunk of its European assets. Assuming the deal goes through, it is possible that staff contracts will survive intact because of a piece of employment law called the "TUPE" Regulations. (Transfer of Undertakings (Protection of Employment Regulations 2006.) The upshot of this is that if you work in a part of the business that has been sold, you could keep your job with the same terms and conditions – and continue to get paid. But the TUPE rules will not guarantee everything will be the same as they were at Lehman. For instance, the rules allow the administrator to agree changes to your employment terms with employee representatives. Not all staff have to agree to these changes and provided they are made with the aim of keeping the business afloat then they will be effective. So, while the TUPE laws are beneficial, don't bank on retaining the same salary level, guaranteed bonuses etc. Also, share options will not transfer to the new job as they are impossible to replicate exactly. The new employer should provide something roughly equivalent but this is likely to get negotiated away in the transfer process.

6. Be patient – As an employee of an insolvent business, you are a creditor alongside banks and suppliers, etc. But it will take the administrator weeks or months to work out who is owed what - and to identify what assets are available to pay them. The administrators have a statutory duty to contact you but if you do not hear anything after a few weeks there is no harm in contacting them. But time and energy is better spent considering your next career move, polishing up the CV, registering at agencies etc, than ploughing a lot of wasted energy into claiming or chasing what could be a small or non-existent pot of money.

7. Manage your expectations – when a company collapses, there are strict rules about which debts are given priority. So called preferential debts come towards the front of the queue but for employees they are currently restricted to (a) remuneration owed for the four month period before the start of the relevant insolvency proceedings, subject to a maximum overall claim of £800 per employee and (b) accrued holiday pay in certain circumstances. Senior staff must also be aware there are circumstances in which they could be forced to repay money to the administrators. Directors - by which the law means actual directors not those with the title director or managing director - who are found to have engaged in wrongful trading risk having to repay money. This is where a director, at some point prior to the insolvency process, knew or ought to have known that the company was in serious trouble and could not avoid becoming insolvent but did not begin the winding up process.

8. Take advice before suing – some employment claims need to be made within three months or you lose your right to bring them. So it may be worth lodging an initial claim at the Employment Tribunal ahead of the cut off. You can always pull out if you change your mind later. Claims for breach of contract, for instance over notice pay can be brought in the courts up to 6 years after the event. It may be worth asserting your claims just in case there is more money at the end than is currently expected. However, unless you think there is a realistic possibility of being paid, a successful claim may be a pyrrhic victory - and may take ages as all cases are put on hold against an insolvent business.

9. Co-operate – if you are a director of the insolvent company, the administrator/liquidator may contact you directly to discuss the affairs of your employer and your actions. You have a duty to co-operate and any failure to do so may form the basis of an application to have you disqualified as a director or involved in the future management of a business. .

10. Make a claim for your redundancy pay - If your employer is insolvent, it may not be able to pay you all the monies due to you but you may be able to claim money from one of the Insolvency Service’s Redundancy Payments Offices. Payments can cover all or some of any unpaid wages, outstanding holiday pay and, if you did not receive the correct notice of dismissal, compensation for this. As always with Government Schemes, there are strict limits on the amount of compensation and it is likely to be a fraction of what you are owed, particularly if you are a Lehman banker.

Jane Mann and Joanna Chatterton are employment partners at law firm Fox Williams

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