Sacked steel erector at Wembley stadium issues High Court writ claiming damages of up to £30m
Shareholders of Cleveland Bridge are to create a £15m fighting fund to contest its dismissal by Multiplex from the Wembley national stadium project.
A source at the steelwork contractor said it was determined to fight the case in court, and that it had the backing of shareholders for this action. The source said: “We have the money and balls to fight Multiplex on this one. We believe that it has been very unreasonable in its dealings with us.”
Cleveland Bridge this week filed a High Court writ against its former employer claiming damages of up to £30m after it was dismissed from the scheme last month. The company announced on Wednesday that it is to begin consultation on up to 95 redundancies at its headquarters in Darlington, County Durham.
The source added that Cleveland Bridge had been paid for most of its £60m steel package but was still owed £6m. In a statement on Wednesday afternoon Multiplex said it would “rigorously defend” any action.
The Wembley row has led to fears that the stadium will not be delivered on time and budget.
Cleveland Bridge had ended all co-operation with Multiplex and has withdrawn its designs and steel resources. The source at the company said this would lead to problems in Multiplex’s schedule, and that the stadium could be delayed by up to a year. Multiplex denied this: “Multiplex is confident this will cause no delay to the Wembley programme.”
A source at Wembley National Stadium Limited said senior figures were this week writing to all of the stakeholders, including David Davies, the acting Football Association chief executive, to reassure them that the project would be delivered on time and cost.
The source said that WNSL had been aware of the problems and believed Multiplex had contingency plans in place to deal with them.
The WNSL source said: “Multiplex is an astute contractor and is working hard to sort these problems out. We have been reassured that the project would not face delay.”
We have the money and the balls to fight Multiplex on this one. We believe it has been very unreasonable
Cleveland Bridge source
The source added that WNSL had just received confirmation from HSBC and Barclays that they would be pressing ahead with a £100m financial package to fund the cost of the stadium.
The source said: “WestLB had taken on the bulk of the funding. But now the arch is up and the high risk part of the project is over, Barclays and HSBC have taken on £100m of loans, which they will put out to syndication.”
Brian Rogan, deputy managing director of Cleveland Bridge, said the company was “naturally very disappointed” that it was forced to make redundancies.
He said: “We are doing everything in our power to replace the fabrication work for Wembley Stadium by bringing forward other projects, but there are technical and logistical reasons that make this difficult.”
He added: “We had no other choice than to instigate legal action against Multiplex and we made this very tough decision for the benefit of the company as a whole, as we very much want this business to survive and continue to contribute as a significant member of the Darlington community.”
Rogan said he would work with staff, trade unions and leading community representatives to carry out the redundancies. Cleveland Bridge’s proposed redundancies will affect 30 staff jobs and 65 manual operative jobs.
It is understood that Multiplex and Cleveland Bridge drew up an agreement in February to resolve differences and move the project forward. The source at Cleveland Bridge added that Multiplex then took the contract to adjudication and claimed that Cleveland Bridge owed it £14m.
- It is understood that Multiplex is looking for a senior project director to take over its £500m White City retail park in west London.