The private equity dealmaker is now playing defensive after not been able to turn round City Link. Probably, the 2,760 workers may be saved from losing jobs at the parcel delivery business with the taxpayers picking up the redundancy bill over next few days.
Every possible way was explored to save the company that collapsed on Christmas Eve, says Jon Moulton, founder of City Link’s owner Better Capital.
Talking to FT Jon added he lost his own money too in several million pounds.
As the company is now insolvent, the employees will be referred to government’s statutory redundancy payments scheme, said administrator Ernst & Young. In such circumstances this type of arrangement is believed to be standard.
Meanwhile, general secretary of RMT union speaks in a different tone. Mick Cash said such situation has happened due to the state of industry in Britain today. Writing to the administrators last night he urged to hold off issuing the redundancy notices as talks with business secretary Vince Cable is still to take place who had earlier agreed in meeting the unions in new year.
Apart from all these, on Monday morning the City Link employees have announced holding up demonstration outside the depot in Glasgow.
RMT has mentioned a figure of 2,000 employees losing jobs this week, but Ernst & Young declines on the number as substantial redundancies would be taking place in next few days under which some of the staff will be retained for up to three months.
