As Kirkcaldy firm Havelock collapsed into administration one of the 250 workers made redundant said “somebody should do jail for this”.
There was fury among the stricken workforce after news PricewaterhouseCoopers (PwC) had been appointed as administrators was leaked before employees were told.
A national newspaper carried details of the sackings, yesterday morning, hours before a meeting of staff called to make the announcement.
Bill Dickson, 66, who was three days from serving for the company for 50 years, said he was “absolutely gobsmacked” by the way the announcement was made.
He said it was “ridiculous”, adding: “We were always hoping that there was going to be some miracle, but again the workers were told to come in at 10 o’clock and it’s all over the papers, so it’s just inevitable what’s going to happen.”
Workers leaving the interior fittings firm at Mitchelston Industrial Estate revealed they had not received their monthly salary.
A handful who had expected to see redundancy payments in their bank accounts on Wednesday night have now been informed they will receive just the statutory amount.
CONFIRMED: Staff in shock at loss of 247 jobs as Kirkcaldy firm goes into administration
Martin Reilly, 55, who was a maintenance engineer for 12 years, said: “At four o’clock on the Tuesday we got told to go home. Then yesterday, a 10-minute meeting to say come back today. We went in today, the administrators stood up, they said ‘sorry, everything’s done’.
“Everybody leaves, hand your keys in, hand over any possessions that belong to this company, hand them back and that’s it.
“There’s a lot of anger but there’s not a lot you can say or do that’s going to make any difference. Somebody should do jail for this.”
Havelock staff have been carrying out work for construction firm Robertson, the main contractor for the Aberdeen Exhibition and Conference Centre hotel and spa fit-out.
On Wednesday, the finger of blame was pointed at Robertson, with allegations – firmly refuted – of non-payment of a £400,000 sum.
Yesterday, a different picture began to emerge, with claims of mismanagement and allegations private investment firm Rcapital, which stepped in to save Havelock when it previously entered administration a year ago, had walked away.
Mr Reilly said: “They’re blaming Robertsons and in all honesty I don’t think that was the bottom line. I don’t think that was them at all.
“This is an ongoing thing that the management never told us. Rcapital never let on to the staff.”
David Baxendale and Zelf Hussain of PwC have been appointed joint administrators.
Mr Baxendale said: “The company has faced a challenging trading environment for some time, and the directors have concluded that there is no longer any reasonable prospect for the company to continue to trade.
“Prior to our appointment, we explored ways that the business might continue to operate whilst a buyer was sought. However, regrettably this has not proved possible and it has therefore been necessary to make 247 employees redundant with immediate effect.
“Our priority is to ensure that all employees are assisted in processing their redundancy claims as a priority. We will be in further contact with all staff as soon as possible and will outline the support available to complete redundancy payment forms. Advice and assistance will also be available from JobCentre Plus and PACE.”
Hopes firm could be salvaged once again as ‘no reason’ for closure
The GMB trade union has not ruled out the possibility that Havelock could be salvaged a second time in just over a year.
GMB Scotland organiser Allison Cairns said there was no reason why the factory should close with a full order book.
“It’s a viable factory, the staff are willing to work, there are orders there,” she said.
“Today I think Rcapital has a lot to answer to because they have literally just walked away.
“If a buyer comes along, I would be looking to re-engage staff that have been made redundant here.
“I will be putting pressure on the politicians and Scottish Enterprise to achieve that.”
Workers, who have expressed fury that the jobs blow was leaked before they were informed, were made redundant with effect from 4pm on Wednesday.
Ms Cairns said: “They were told today that the administrators have known for two days that they were having to close the factory.
“They have no option. The finance wasn’t there. They had been trying to develop plans to keep the factory open. That didn’t happen and they had no option but, unfortunately, to make people redundant.”
She claimed Rcapital, said to have invested £6 million in the factory, could have afforded to cover the £400,000 required to pay wages this month, which are still unpaid.
But she added: “Even if they had enough money to pay the salaries, they don’t have any money to buy the supplies they need to fulfil the contracts.”
A Scottish Enterprise spokeswoman said: “We are working closely with the administrator, alongside our partners, to support the workforce at this difficult time and to explore all options for the future of the business.”
‘Difficult trading environment’ since 2018 buy-over by Rcapital
It is a year since 300 jobs were saved at Havelock when it was bought out of administration by Rcapital.
The move brought optimism to the firm and in March its chief operating officer, George McAdam, said management was “putting the building blocks in for a successful business” with work for major companies including Primark, Hilton and Lloyds Banking Group in the order book.
But the troubled firm had racked up debts in the region of £30 million when it first entered administration.
And in 2017, Havelock had made a pre-tax loss of £5.92m as revenues slid from £60.8m to £53.19m.
A source who contacted The Courier said the nature of the industry meant Havelock could be working on – and paying for – projects for a year or two before they hit the site.
He claimed that due to lack of funding the business had been struggling to bring in materials and procure goods for delivery.
The company would not see “a single penny” for anything until up to 90 days after the job was completed.
“It’s these payment terms from main contractors that hits cash flow,” he said.
He claimed the situation was exacerbated by problems within the company, including “warehouses of dead stock”.
Claire Baker, Labour MSP for Mid Scotland and Fife, said: “The trading environment has been difficult for Havelock for some time. Following its sale last July, the hope was for an improvement in fortunes, which has unfortunately not happened.
“This is terrible news and a very difficult time for those being made redundant and their families.”
She added: “The focus at this time must be on supporting the staff who have turned up to work to be told they no longer have a job.”
