City Link collapse revealed horrific catalogue of mismanagement claims union

UNION leaders say the collapse of Coventry-based parcel delivery group City Link has exposed a “truly horrific” catalogue of mismanagement.

The RMT union levelled the accusation at City Link management following a meeting with administrators EY to discuss the fate of the 2,700 employed by the firm.

The union said the mismanagement had left more than 2,000 people facing the prospect of redundancy of New Year’s Eve with just a skeleton staff being retained to wind down the business ahead of closure.

The union said it had learned at the meeting that the company had been working with insolvency advisors since November without telling the staff or the union.  
 
It added that City Link had been technically declared insolvent on December 22 but it claimed the information had been deliberately withheld.

“A plot to hold the announcement to Boxing Day was only thwarted by the RMT acting on information from a whistle blower,” it said.  
 
It said it had also learned that City Link and its financial backers would have no liability for redundancy payments and the staff would have to apply to the government scheme. The remaining staff will be retained only on a short term basis to wind down the company.  
 
Individual sub contractors, owed thousands of pounds, are unlikely to see any of their money, added the union.

While it confirmed there was no one in the frame to take over the company as a going concern, although there was the possibility of a limited number of jobs being available at other companies.  
 
The RMT has demanded a meeting with Business Secretary Vince Cable and his officials to try and implement a government-supported rescue plan for the firm, which has operations nationwide.

The union said that if the government could nationalise the banks then it could do the same for City Link as such a move was “clearly in the national interest”.

Mick Cash, General Secretary, said: “It is crystal clear from (the) meeting (with administrators) 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 while a plot was hatched to publicly collapse the business on Boxing Day when in fact it was already declared insolvent.  

“What a despicable and callous ‎manipulation of thousands of workers and their livelihoods over Christmas as the venture capitalists cut and run leaving a trail of chaos and misery in their wake.  
 
“Vince Cable has said he will meet us in the New Year. Clearly that is too late and the business will have been smashed to pieces by then as the asset strippers hover like vultures over the corpse.”