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Tuesday 21 August 2018

‘Clock ticking’ for thousands of workers caught in Carillion collapse – unions

The RMT warned ministers not to “duck and dive” over the pay and jobs of workers in private firms as well as in the public sector.

Carillion
Carillion

By Alan Jones, Press Association Industrial Correspondent

Unions have warned that the “clock is ticking” for thousands of workers caught up in the collapse of construction giant Carillion amid fears of redundancies in the coming days.

Firms working for Carillion on private sector contracts will only have Government support until Wednesday, Cabinet Office minister David Lidington has said.

The Rail, Maritime and Transport union (RMT) warned ministers not to “duck and dive” over the pay and jobs of workers in private firms as well as in the public sector.

Leaders of the TUC, Unite and GMB met Business Secretary Greg Clark on Tuesday evening and warned him that workers should not be left to “carry the can”.

GMB general secretary Tim Roache said: “The clock is ticking for Carillion’s 8,500 private sector workers, and the Government must now offer them reassurance and financial guarantees.

“No worker should go hungry, default on a bill or miss a rent or mortgage payment because of a crisis they did not cause.”

Mr Clark has written to the Insolvency Service and the Official Receiver asking that the statutory investigation into the conduct of Carillion’s directors is fast-tracked and extended.

This means the Official Receiver’s investigation will consider whether those who are, or were previously directors of the company may have caused detriment to those owed money, including workers and businesses affected.

The minister has also written to the chairman of the Financial Reporting Council, Sir Win Bischoff, and asked it to investigate the preparation of Carillion’s accounts past and present, as well as the company’s auditors.

Mr Clark said: “It is important we quickly get the full picture of the events which caused Carillion to enter liquidation, which is why I have asked the Insolvency Service to fast-track and broaden the scope of the Official Receiver’s investigation.

“In particular, I have asked that the investigation looks not only at the conduct of the directors at the point of its insolvency, but also of any individuals who were previously directors. Any evidence of misconduct will be taken very seriously.”

Labour leader Jeremy Corbyn said Carillion’s collapse was a “watershed moment” that should bring an end to “rip-off privatisation” of public services.

He said former Carillion directors should have to pay back any bonuses they have received.

“Well the bonuses should come back. When there are people who are sub-contractors or small firms that are contracted into Carillion that are not getting paid, workers being made redundant at 48 hours’ notice, and less in some cases, the directors, for all the bonuses they have had, should pay them back.”

Salaries that are still being paid to the top ranks should be halted, according to the Labour leader.

“They should not be paid anything at the present time because they have run the company in such a way that all these jobs are at risk,” he said.

“So many of our public services are at risk – school meals services, hospital cleaning services, maintenance contracts, Army housing, are all at risk because of the way this company has been run.”

RMT general secretary Mick Cash said: “We have been told that only Carillion workers on what the Government defines as ‘public sector’ contracts will be guaranteed their wages.

“Clearly, anyone working in the rail sector is providing a service to the public and we are calling on the Government to confirm that there will be no dispute over this point and that our members will continue to be paid with their functions taken directly in-house.

“There should be no equivocation from the Government and no attempt to duck and dive around this issue.

“All of the Carillion rail works on the various contracts can be brought ‎in-house easily and that is what we expect to happen with jobs and services protected.”

TUC general secretary Frances O’Grady called for a national taskforce involving unions to safeguard jobs, services and pensions.

“Workers can’t be left at the back of the queue. Each and every worker at Carillion needs to know where they stand. They have bills and mortgages to pay, and deserve certainty on their future.

Carillion has public sector or public-private partnership contracts worth £1.7 billion, including providing school dinners, cleaning and catering at NHS hospitals, construction work on rail projects such as HS2 and maintaining 50,000 Army base homes for the Ministry of Defence.

But its shares price has plunged more than 70% in the past six months after a string of profit warnings, and breached its financial rules.

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How Carillion's share price fell. Infographic from PA Graphics.

The group, which employs around 20,000 British workers, has been struggling under £900 million of debt and a £587 million pension deficit.

Anger is growing over bumper payouts received by Carillion’s former chief executive Richard Howson.

He pocketed £1.5 million in salary, bonuses and pension payments during 2016 and, as part of his departure deal, Carillion agreed to keep paying him a £660,000 salary and £28,000 benefits until October.

Press Association

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