The occupation of a
Wedgewood factory by workers in protest over the company being put into
administration represents a new worry for insolvency practitioners.
Experts believe the sit-in protest by angry workers at the Waterford
Wedgewood crystal factory in Ireland is unlikely to be a one-off incident.
The protest at the 250-year-old crystal and crockery maker was still
continuing as Accountancy Age went to press.
Last week 13 workers at the company also marched into the head office
reception of the company’s auditor Deloitte to protest over the actions of the
receiver David Carson.
The deadlock at Deloitte’s office only ended after a meeting between two
Waterford workers and Deloitte senior partners.
James Money, restructuring and recovery services director at Smith &
Williamson, says that similar protests may occur in other hard-hit industries,
such as the car and steel sectors.
Administrators have the same powers as company management when people
trespass on company property, including the right to press charges against those
causing criminal damage. ‘When a company goes into administration and somebody
does something illegal, the same laws still apply,’ says Money.
Dealing with staff who are understandably angry and upset is tough, but
insolvency practitioners can help maintain good relations with staff by keeping
them informed about business developments, taking care not to raise unrealistic
expectations, Nick Hood, a partner at insolvency specialist Begbies Traynor
‘The key is to make the workforce understand what is happening. The real
know-how comes in carrying them with you as you’re doing your job.
‘There’s a hardening of attitudes among the workforce because, for very good
reason, they are frightened for their jobs in what is a very tricky economic
situation,’ says Hood.
‘It does make your job more difficult so IPs will have to pay more attention
to the likelihood of this happening than previously. My golden rule is never
make promises to the workforce that you can’t deliver.’
Ultimately, however, the administrator has to act in the interest of the
creditor. ‘You can’t force somebody to buy a company, but in many ways,
achieving a going concern sale is a mark of success to an IP,’ says Money.
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