Reports suggest as many as 230 employees have lost their jobs after the Oxfordshire-based Formula One team and owners 1Malaysia Racing Team (1MRT) both entered administration.
Administrators claim the decision to take action is for the benefit of employees and have reiterated their desire to see Caterham compete in the Abu Dhabi Grand Prix next weekend after raising the required finances to take part in the final race of the season through crowd funding.
"For the past few weeks 1MRT has had insufficient funds to pay staff salaries," read a statement from Smith and Williamson.
"However, now that the administration process for 1MRT has started, and the staff are formally made redundant, employees are now able to make their claims to the Redundancy Payments Office.
"Following discussions with 1MRT staff representatives, it was confirmed that - given the current situation - many of the employees' preference was to be made redundant as this would enable claim forms to be processed.
"This in no way affects the Caterham F1 Team showcasing itself at Abu Dhabi which is being done in order to maximise chances of getting a purchaser to complete a deal and so enhance potential for a long-term solution and re-employment.
"At the same time 1MRT staff can now put their employment claim forms in to the Redundancy Payments Office."
The statement also paid tribute to the staff, adding: "The Leafield workforce has been, and continues to be, hugely supportive of the plans to get the CaterhamF1 team back on the track under new sound financial ownership and they have done this by pledging their help and time to the RefuelCaterhamF1 Project.
"We are very grateful to them and they deserve thanks and support.
"We are also very mindful of the uncertainty which staff and their families have been facing.
"We are convinced that finding a buyer for the team will help secure a long-term position for the workforce – and finding such a buyer is our aim."