Infracon collapse shatters staff

STAND STRONG: Staff leave Infracon in Hastings, after liquidators take possession of the site.PHOTO/APN

"It's all over," gutted Infracon employee Dave Barrett told the Dannevirke News this week.

The more than 200 staff at the roading company had been called to meetings by liquidators PricewaterhouseCoopers who had posted security guards at the entrance to the depots.

"There's no wages," Mr Barrett said. "We've been told we've got up to $20,340 in preferred treatment redundancy, but this is really going to hit our Tararua towns," Mr Barrett said.

And while 100 staff members have been asked to go home by PwC liquidators John Fisk and Tony Pattison, another 100 at Infracon depots in Dannevirke, Woodville, Hastings, Waipukurau, and Palmerston North have been asked to remain working on a day-to-day basis until they can enter into a liquidators agreement.

Mr Fisk said the 100 Infracon staff sent home will be called in a few days once he and Mr Pattison have analysed their employment contracts.

"We've done an initial review of the business and there are aspects of it which could have better value as a going concern," Mr Fisk said. "However, there are other aspects which are losing money.

"The most likely part of the business which are quite viable are the aggregates and quarries and we'll be interested in selling those."

Staff made redundant are eligible for up to $20,340 in payments before tax for holiday pay, wages and any redundancy entitlements, Mr Fisk said.

Meanwhile, an angry Mr Barrett, who has worked for Infracon for six and a half years said he and fellow workers have coined a new nickname for Tararua District mayor, Roly Ellis.

"We're calling him Sellers Ellis, because he and his board of Infracon directors put us into liquidation," he said.

"I've been shafted two ways because I work for the company and I'm a Tararua ratepayer as well. Ratepayers' money has just disappeared. These people who are running our district have s**t for brains."

Mr Barrett said feelings were running high especially over the fact Tararua District councillors had stepped up to take on interim directors roles at Infracon after mass resignations by the previous board.

"A lot of our guys are pissed off," he said. "Since last week when we were told the liquidators had been called in we haven't been able to carry out our work.

"We're fed up because our council is trying to show they're supportive by setting up the worker's hub in Woodville, but our guys are going to lash out, they're so angry," Mr Barrett said.

Woodville businessman, Kevin O'Connor, the owner of the New Central Hotel and Motor Inn agreed the redundancies would affect everyone.

"But that's life and the reality is you can't expect a company to keep on losing money for years," he said. "Our council should have done something about this years ago if they knew Infracon was losing money. There must have been poor management within Infracon and while I feel sorry for the people affected there are questions which need answering."

This week Mr Ellis said he hadn't been informed of what was going on at the company which is 66 per cent owned by his council and 34 per cent by the Central Hawke's Bay District Council.

Last Thursday the interim board of Infracon made the decision to call in liquidators after the bank had withdrawn financial support for the beleaguered company, with Mr Ellis saying the company was insolvent.

"It would be illegal for us to continue trading," he said. "Infracon had had five years of losses with more forecast for the coming two years."

Jobs at Infracon were put in jeopardy in July when the Tararua District Council announced it was negotiating a roading corridor network maintenance alliance agreement with Downer EDI Ltd.

Mr Ellis said it was a case of good quality roads at the right price and contract aspects included the way the preferred roading company performed, technology and the machinery they use.

"We [council] haven't washed our hands of Infracon staff and we'll do everything we can to help out," he said.

Mr Fisk said the liquidation process for Infracon was likely to take some months.