Major projects division is restructured after heavy losses on National Physical Laboratory scheme.
M&E contractor NG Bailey has cut 26 jobs after restructuring its major projects division.

The decision to reduce the workforce comes after the company suffered losses of up to £10m on the National Physical Laboratory in Teddington, south-west London. The scheme was handled by its major projects division.

NG Bailey managing director Martin Bailey said large contracts would be handled at a regional level. He added that, as regional branches had evolved, there was less need for a major projects arm.

The division has been renamed special projects. Bailey said it would focus on projects with specialist requirements as well as acting in support of regional operations.

He said: "The company regrets that as a result of the restructuring of our business some redundancies are necessary. We have consulted the employees that are affected, and where appropriate we are in the process of offering alternative employment within the company or voluntary packages."

It is understood that Martin Bailey decided to restructure the major projects division after the problems surrounding the NPL project.

One source close to the firm said it was likely that there would be more redundancies in the restructured division and it may even close.

Bailey is taking stock right now. But I still think it is a good company Contractor who had worked

with NG Bailey

The source said: "As the division is in Yorkshire, it is likely that it may even close altogether as the company is trying to refocus in London and the South-east."

He added that the firm was also about to announce that its turnover would fall.

The group refused to comment whether this was the case. The group's turnover for the year ending 31 March 2001 was £350m.

One contractor that has worked with NG Bailey claimed the firm was still in good shape, despite the restructuring. The contractor said: "Bailey is taking stock right now.

But I still think it is a good company. It does a lot of training, which is positive for the industry."

NG Bailey settled out court with contractor Laing for up to £10m after the trouble at the NPL. Laing lost £70m on the PFI project. The job ran into serious problems over the high specifications of the air-conditioning systems required by some of the laboratories and the tough penalty clauses in Laing Construction's contract.