Contractor calls in insolvency firm in major company failure

Troubled Scots firm WJ Harte has made 500 of its staff redundant, after calling in insolvency specialist PKF as an interim manager.

PKF said the failure, one of the largest in Scottish construction in recent years, was caused by a collapse in turnover at the firm and “considerable” bad debt from creditors.

The appointment of an interim manager is a precursor to a full-blown administration.

Turnover at WJ Harte peaked in 2007-08 at £102m, but this plummeted to £40m over the past two financial years.

PKF will also take over management of WJ Harte’s sister company RJT Pennant.

WJ Harte and RJT Pennant are the two largest parts of Bothwell-based Harte Group, one of Scotland’s largest construction firms, employing over 600 staff.

Harte Group’s FJT Excavations business is not part of the process.

WJ Harte staff were turned away from the contractor’s headquarters in Bothwell on Monday, prompting several calls to construction union Ucatt by employees fearful for their jobs.

One employee, who works in the firm’s Glasgow office, told Building yesterday that workers at his office were packing up their desks and claimed “nobody had been [officially] informed of anything”.

The Glasgow employee added: “It’s felt like the firm has been hanging on for the last six months. People were doing double and treble work to cut costs and keep work going.”

Anne Buchanan, joint interim manager of the Harte Group and corporate recovery partner with PKF, said: “Harte Group is a long established, highly regarded firm servicing the construction industry.

“The firm has experienced a severe reduction in turnover over the last few years as well as considerable levels of bad debt from creditors who themselves have gone bust.

“Despite shedding jobs over the last few years to cope with this decline in turnover the firm is now unable to continue trading.”

Labour councillor Maureen Devlin, who represents Bothwell, said: “This is a really sad time - Bothwell has very long-standing links with construction and these redundancies come at a bad time [for the local economy].”