Collapse of Fastrack means 150 workers face loss of thousands of pounds of pay.
A construction labour agency that supplied staff to rail contractors has stopped trading, making it unlikely that 150 workers will be paid the money they are owed.

Fastrack Resources Group of Southampton, whose agency staff work primarily in the rail maintenance sector, is expected to appoint a liquidator next month.

Many of the staff claim that they are owed thousands of pounds in unpaid wages and bonuses. One claimed he was owed £10,000.

The failure of the firm has also led to renewed calls from construction unions for a review of legislation over labour agencies. Unions expressed concerns at a DTI summit last year on employment terms.

Fastrack ceased trading on 17 January. Chief executive Graham Palfrey Smith said the turning point came when financial backers withdrew support. Palfrey Smith said: "We ran out of funds because of the decisions made by GE Capital and Close Brothers. The whole thing has been painful and traumatic for everyone concerned."

GE Capital and Close Brothers refused to comment, saying it was confidential.

We ran out of funds. The whole thing has been painful and traumatic

Fastrack chief Palfrey Smith

Fastrack financial director Chris Lowe said he and Palfrey Smith had been appointed last year to turn things around. He said: "We gave it a good try, but the company was beyond help."

Fastrack had 250 workers on its books. In addition to construction workers, it employed surveyors, planners and quantity surveyors.

One hundred Fastrack employees working in the rail maintenance sector were last week transferred to Prima Services Group, which supplies manpower to the rail industry.

Prima said it was negotiating with Fastrack's bankers over whether these employees would be paid for work carried out before the company folded. Prima managing director Don Clarke said: "We are not going to dump on anybody. We will pay them and bill the clients. Their wages will be paid."

But whether the remaining 150 staff on Fastrack's books will be paid is unclear. Palfrey Smith said it was doubtful. He said: "GE Capital owns the debt and is lead creditor. The Fastrack staff and myself are also creditors. We're all in the same boat."

Bob Blackman, national construction officer at union T&G, said it was unlikely that employees would be paid the money owed unless they transferred to Prima. He said: "We are very concerned about this. There is very little chance of people getting any of that money."

On the broader question of labour agencies, Blackman added: "Because the industry is very busy and there is a shortage of labour, it means anyone can supply labour."

Palfrey Smith defended working practices at his firm. He said: "The quality of workers supplied by Fastrack was well above average, because of the safety standards we had to meet."

Contractor Interserve, which used Fastrack, said in a statement it had a good working relationship with the agency and was sorry to hear it had closed.