Accusations fly over closure of Northwood Environmental
8:20am Thursday 4th October 2012 in Latest News
THE boss of a recycling firm that went into administration, costing 65 people their jobs, failed to avert disaster, despite knowing the company was on the slide, it has been claimed.
North Swindon MP Justin Tomlinson said James Jennings was aware in May that Northwood Environmental, set up to reduce youth unemployment in Swindon and other parts of the country, had cashflow problems.
But he pressed on with an ambitious plan in Swindon to hire 20 new trainees a month, who were paid as little as £3.33 an hour while studying for NVQs in manufacturing.
The firm failed to generate cash from the recycled materials and Mr Jennings then looked to other parts of the business to offset the losses, according to various sources.
Skillsfinder UK, an NVQ training provider in dispute with Northwood over an undisclosed sum of money, claimed yesterday that the operation on the Hawksworth Industrial Estate did not make a single sale of recycled products from the scrap it had collected.
Northwood failed to pay staff on Friday and the workforce returned after the weekend to be told it was ceasing operation with immediate effect and they were being made redundant.
Mr Jennings claims that Skillsfinder defaulted on payments amounting to £250,000, which tipped the company into liquidation and led to 150 staff being made redundant across the country.
The training provider confirmed it was in dispute with Mr Jennings but said it was over a much smaller sum relating to room hire, lighting, heating and other related costs.
Skillsfinder has repeatedly said it was not responsible for paying the apprentices’ wages.
Mr Tomlinson said: “While James Jennings was outwardly talking of rapid expansion, behind the scenes chaos was unfolding.
“It’s clear that he was overwhelmed and had expanded far too quickly without any financial safety net in place. I hope that alternative organisations quickly step in to play to provide new opportunities for those caught in the middle.”
Among the trainees facing hardship is Mitch Clark, 20, who is owed £1,400 and faces eviction from his flat after working on for nothing when Northwood failed to pay his wages.
He said: “This has stressed me out to the max, I could be kicked out any day. We have been told to wait for another letter before we can claim redundancy money and even then it could take up to six weeks. The way we have been treated is a disgrace.”
Northwood has operations across the country, including in Coventry, Huddersfield and Warrington and a partnership with Group 4 Security to provide work placements for 65 prisoners at HMP Oakwood, in Wolverhampton.
Mr Jennings, from Matlock in Derbyshire, continues to point to Skillsfinder for the fiasco.
The 36-year-old company boss provided an email said to be from Chris Martin, Skillsfinder’s quality and development manager, promising to transfer a series of payments to Northwood.
But Mr Martin said yesterday that the message had been written on his behalf by Mr Jennings, who then asked him to send it to another firm being lined up to support Northwood.
Mr Martin said he did not agree to help with the request for more than £250,000.
He said: “They have been coming to us and asking if they can borrow money from us but we are a training provider and we haven’t got the money. In fact, they’ve damaged our organisation hugely because we are funded by the Government to deliver apprenticeships.
“If we can’t deliver those, we’ve lost a huge sum of money.”
Mr Martin claimed Northwood failed to take into account that the staff would need training and support before the factory could be efficient in selling on products to other companies.
Mr Martin said he was trying to secure alternative ways the apprentices could continue with their NVQs.
Mr Jennings did not respond to a request for comment yesterday He has promised to do all he can to reimburse workers with the money they are owed.