City Link staff 'face NYE redundancy'

28 December 2014 Last updated at 06:58

More than 2,000 staff from the collapsed UK parcel delivery service City Link are to be made redundant on New Year's Eve, the RMT union has said.

Staff learned on Christmas Day that the company had gone into administration, in a move described as "disgraceful" by the union for transport workers.

Talks between union officials and administrators EY were held on Saturday afternoon.

EY warned of "substantial redundancies over the coming days".

Coventry-based City Link, which is owned by investment firm Better Capital, employs 2,727 people.

It called in administrators on Christmas Eve after years of "substantial losses".

'Smashed to pieces'

Following Saturday's talks, the RMT demanded an immediate meeting with Business Secretary Vince Cable and called on the government to launch a rescue plan to save the company as a going concern.

The union said it had been told by administrators that more than 2,000 staff will be made redundant on New Year's Eve. Remaining staff will be retained in the short term to wind down the company, union officials said.

Mick Cash, RMT general secretary, called the situation a "despicable and callous manipulation" of thousands of workers.

He said: "It is crystal clear that there has been a truly horrific catalogue of mismanagement at City Link and that staff and their union have been starved of basic information."

The government has previously said it was unable to intervene in the administration process, although Mr Cable said he would meet the union in the New Year.

However, Mr Cash said: "Clearly that is too late and the business will have been smashed to pieces by then.

"If the government can nationalise the bankers then they can nationalise City Link, which is clearly in the public interest," he added.

The firm, which was founded in 1969, was acquired by restructuring specialist Better Capital in April 2013.

It invested £40m but EY said City Link had incurred substantial losses over several years and the money could not help it turn the firm around.

'Substantial redundancies'

EY said it was currently assessing the company and the status of existing orders.

"This process will have a bearing on the number of employees retained and those that unfortunately face redundancy in the next few days," it said in a statement.

"It is anticipated that there will be substantial redundancies over the coming days, at which point the administrators will provide a further update."

It said it anticipated that "a portion of employees" would be retained for up to three months.

Administrators were currently gathering expressions of interest from parties interested in acquiring specific assets, divisions of the business or the entire firm, it added.

But given the previous unsuccessful sale process administrators were "cautious about the prospects of finding a buyer", the statement added.

City Link employees
Location	Total employees
Aberdeen	19
Ashford	24
Bangor	16
Basingstoke	25
Beckenham	23
Beckton	32
Belfast	23
Bicester	28
Birmingham	70
Bournemouth	32
Bristol	50
Cardiff	44
Carlisle	28
Chelmsford	48
Coventry	404
Cowes	4
Durham	56
Edinburgh	22
Edmonton	36
Epsom	22
Exeter	41
Gatwick	42
Glasgow	75
Glenrothes	22
Gloucester	32
Guildford	24
Hatfield	116
Heathrow	132
Leeds	1
Leeming	34
Leicester	1
Lincoln	25
London City	19
London West Central	43
Maidstone	48
Manchester	67
Milton Keynes	91
Morley	74
Motherwell	27
Newcastle	45
Newmarket	1
Northampton	47
Norwich	44
Nottingham	48
Peterborough	63
Plymouth	58
Preston	52
Reading	2
Rotherham	34
Scunthorpe	28
Shrewsbury	38
Southampton	33
Stafford	40
Swansea	30
Swindon	73
Warrington	115
West Bromwich	56

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