News & articles

Carillion Suppliers Begin To Lay Off Workers

January 23rd, 2018

The liquidation of construction company Carillion, which happened earlier this week (January 15th) has started having a knock-on effect for other firms across a range of industries.

According to the Guardian, subcontractors that are owed money by Carillion have begun laying off members of staff after being pressured by their banks to pay what is owed by them.

Carillion employees currently providing services to businesses in the private sector may already have started seeing their wages stopped unless they can find work elsewhere.

When the liquidation announcement was made, it emerged that the company had just £29 million in cash when it collapsed – and PwC and EY, two of the biggest accounting firms, refusing to act as administrators amid fears they would not be paid. And it seems that creditors have now been warned that they will most likely receive less than a penny for every pound they’re owed.

For workers, it’s equally as bleak – Carillion employed approximately 20,000 people directly and all these jobs are now threatened. And then there’s the supply chain, with up to 30,000 small businesses employed in this manner and believed to be owed money by Carillion.

Former Labour transport minister Andrew Adonis was quoted by the news source as saying: “It is a bit like Lehman Brothers [the Wall Street investment bank that collapsed in 2008]. You don’t know what the impact will be. A very large part of Carillion’s work was project management where subcontractors do the work, but these subcontractors don’t know if they will be paid.”

Managing director of Cambridge-based landscaping firm Flora-tec Andy Bradley told the paper that he has already had to lay off ten out of his 90 employees because Carillion owes him almost £1 million. He explained that although his business is profitable, it’s not able to trade out of such a big black hole.

If you have been made redundant this week and are worried for the future, redundancy solicitors can help make sure you get what you deserve and what you’re owed. If you have unfortunately received notice of redundancy, we here at Lennon’s Solicitors can offer you advice on your particular position and support you through what can be a very difficult and emotional process.

It’s never too soon to seek advice so if you have just been made redundant or are concerned that you’re going to be one of the ones let go as a result of the Carillion collapse, get in touch with our team today. You can ask for an initial consultation meeting, which has a one-off fixed cost.

Employers should always meet with employees before making any redundancies to give them information on why the redundancies are necessary and if there are any other alternatives. You are entitled to redundancy payments if you’ve been continuously employed by a company for at least two years.


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