2,000 jobs axed as courier firm collapses

City Link, which employs 2,727 workers, has gone into administration.
City Link, which employs 2,727 workers, has gone into administration.
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More than 2,000 workers will lose their jobs on New Year’s Eve because of the collapse of parcel delivery firm City Link, union officials have claimed.

The RMT has been in crunch talks with administrators Ernst and Young (EY) today in a bid to hammer out a deal to prevent thousands of redundancies at the firm.

But after being locked in discussions all day, union bosses say they are no closer to a deal.

They have urged Business Secretary Vince Cable and the Government to step in immediately to help broker a rescue package to salvage the jobs.

The RMT claimed it had been told by administrators that more than 2,000 staff will be made redundant on New Year’s Eve. Remaining staff will be retained in the short term to wind down the company, union officials said.

Mick Cash, RMT general secretary, said: “It is crystal clear from today’s meeting 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.”

Mr Cash said Mr Cable must meet with the union immediately, and said talks in the new year would be “too late”.

He said: “We want to put a plan together for a Government-backed rescue that protects the business and the jobs it supports. If the Government can nationalise the bankers then they can nationalise City Link, which is clearly in the public interest. “

City Link announced on Christmas Day that it is going into administration after years of “substantial losses”.

Officials have met in Leeds to discuss the fate of the firm’s 2,727 staff, and union bosses vowed to stay in talks for as long as it takes to salvage jobs.

City Link operations have been suspended at all its depots until Monday, when customers and those expecting deliveries will be able to collect their parcels.

Investment firm Better Capital, led by veteran venture capitalist Jon Moulton, bought the courier group for just £1 in April last year from the previous owner, pest control firm Rentokil.

A number of staff will be retained to help return parcels to customers and help with winding down the company, EY said.