Until Bob Blackman is voted out and replaced with a more conscientious politician.
We first found ourselves writing to Bob Blackman in 2010, after having exhausted all other avenues and repeatedly being told to contact the local MP, since we needed to have a change to the law introduced, and a challenge to the Government's decision not to prosecute Company Directors that had blatantly defrauded workers.
Unfortunately, right from the get-go, Bob Blackman has never taken this matter seriously, and repeatedly kicked the issues into the long grass, hoping that they will go away and be forgotten about...
For those who might be interested, here's our experience: In 2007, around fifty-five people (many of whom are Indian, Sri Lankan or Pakistani and thus not speaking English as a first language) were exploited by an unscrupulous employer, after the Directors of that business suddenly started bouncing staff wage cheques and later claimed that they were having temporary cash flow problems - allegedly due to a slow-paying customer - but insisted that the company had a full order book and was in robust financial health; further promising the employees that wages owed would be repaid as soon as money was received from the customer.
Money owed was never repaid, and instead, the company refused to issue payslips or contracts to their workforce for the missing wages, so staff consulted the local Jobcentre, but were told that if they walked out, they would have made themselves "intentionally unemployed" and therefore would be ineligible to claim any sort of out of work benefits. Legal advice was sought, but the only advice that the employees received was to go to an Employment Tribunal, which in turn could only be done one month after grievance letters had been sent to the company Directors... Therefore, grievance letters, arguments and Employment Tribunal claims ensued in the next weeks. However, because the staff now had no money to pay their rent and bills, Landlords threatened them with eviction, since they wouldn't believe that employees were working, but not but not getting any money for it.
The compulsory month delay is supposed to allow Employers and Employees to reach a settlement without using the Tribunal service. However, the Directors simply refused to speak to ACAS, ignored Employment law and legal correspondence, including Solicitor's letters and other legal paperwork - instead choosing to bully, intimidate and harass employees that had initiated Employment Tribunal claims into leaving, no doubt so that they would not have to make redundancy payments - all of which made life extremely difficult and stressful for the workers.
At that time, Ealing North MP Steven Pound was contacted (he was the local MP for the area in which the aforesaid business was located), and he said:
The withholding of earned wages is a criminal offence. No "ifs" and no "buts".
Get the Police involved and they'll bring in the Fraud Squad!
The Police, however, refused to become involved with what they termed "Civil matters", at which point Mr. Pound decided that because I wasn't his constituent, he couldn't help further, and suggested writing to the then Local MP (Tony McNulty). Mr. Pound said that he would forward my correspondence to Mr. McNulty, and I also wrote directly to Mr. McNulty. Tony McNulty decided to ignore both of us - and it subsequently transpired that Mr McNulty was more interested in fiddling his Parliamentary expenses than helping local constituents.
After many months of legal wrangling, Employment Tribunal claims were won, and again ignored by the company Directors, along with subsequent enforcement of those Tribunal claims through the County Court, further Employment Tribunals, and eventually claims for Constructive dismissal.
Later (After being presented with a winding up order by HMRC) the Directors simply closed the company, and quickly reopened under a different name - carrying on the same line of business, using the same plant and machinery, operating from the same premises, with the same Top Management and shareholders, as well as the same customers and suppliers.
At this point, it transpired that there was no slow-paying customer, but that the company's financial Auditors had qualified the company's previous annual accounts with doubts about the solvency of the company, high levels of bad debt, and had further questioned the potential resale value of large amounts of stock held. The Directors had then gone on to abuse an invoice factoring service by submitting large numbers of invoices for goods that had never been manufactured, which we now believe lead to the withdrawal of the banks support of the business [PriceWaterhouseCoopers (PWC) was sent in by Bank of Scotland Cashflow Finance, although we were never told why at the time], and ultimately caused a withdrawal of credit lines by suppliers.
This rogue employer then failed to pass employees details to the Insolvency Practitioner, so that workers were not even made aware that they had lost their jobs until after Christmas. Further, they later discovered that as well as wages, neither PAYE nor National Insurance contributions had been paid, causing additional problems that they were left to individually straighten out with HM Revenue & Customs.
Next, the former company's Statement of affairs was found to be greatly at variance with the witness statements of former employees and the findings of numerous Employment Tribunals. So, many former employees complained to the Government Insolvency Service, The Serious Fraud Office (SFO) and Companies Investigation Branch (CIB), whilst the Insolvency Practitioner also submitted an adverse report about the Directors to the Insolvency Service - The Government ignored all these reports
Despite all of this, Legal experts, the High Court and three different Insolvency practitioners say that there is little that can be done now, since the Directors of this company have exploited a loophole in the Law, (which quite obviously needs to be addressed)... We therefore contacted the current local MP, Mr. Bob Blackman, who, after he had been sent numerous letters and follow-ups requesting an acknowledgement or response - over a period of many months - instead of arranging that the Directors be struck off, starting an inquiry into this scandal or introducing new legislation to close the loopholes in the Law (and forgetting all about compassion, integrity, fair dealing or accountability to the wider community), finally tried to bury the matter by responding with a terse message, backed up by Edward Davey (then Minister for Employment Relations, Consumer and Postal Affairs) saying:
[pursuing this matter] is not in the public interest
As you might imagine, we were shocked and surprised to be given such an arrogant, dismissive response; and even more astonished to find that Mr. Blackman - who is supposed to be representing the interests of Harrow East constituents - ignored further correspondence, whilst attempts to pursue this matter by telephone only elicited the comment that "Mr. Blackman is busy", from his Office staff, and then zero attempts to return phone calls. Similarly, messages sent to him via other Members of Parliament received the same brick wall response. At which point, the Impeach Bob Blackman campaign was founded, because it appeared that Bob Blackman was siding with the corrupt Directors of the business that we worked for, and was refusing to help the former workers.
Interestingly, in March 2011, The Government consulted on pre-pack sales to connected parties, and Bob Blackman failed to put our case to Edward Davey, making a joke of Mr Davey's claim that he wanted: "...to make sure that Creditors have a fair chance to have their voice heard."
At this point, it might be helpful to summarise why we say there was wrongdoing and unfitting conduct exhibited by the Directors:
- Employees were lied to about the financial state of the company, when Directors claimed that they were "temporarily short of funds because of a slow-paying customer".
- Employees were Lied to, about the company having a full order book and a strong balance sheet - it subsequently transpired that their Financial Auditors had qualified the previous year's accounts with doubts about the solvency of the company.
- The Directors clearly had no intention of paying employees their earned wages, since the Directors would have known all the above information when they issued cheques to employees, from an account which had insufficient funds to cover the payments.
- The Directors told yet more lies claiming that all the money owed to the workforce would be paid back.
- The Directors failed to tell the Employees about the poor financial health of the company.
- The Directors hid the fact that their Financial Auditors had previously advised them of the poor financial state of the company in 2006 and 2007 from the staff
- The Directors later completely stopped paying employees their earned wages.
- The Directors continued the company's trading for a lengthy period whilst when the company was insolvent.
- The Directors failed to keep proper accounting records.
- The Directors failed to prepare and file proper financial accounts.
- The Directors failed to send accounts or returns to Companies House.
- The Directors failed to pay taxes and National Insurance owed by the company.
- The Directors made fraudulent claims to an invoice factoring service, for goods that had never been manufactured.
- The Directors made every effort not to keep written records of this scandal.
- The Directors concocted ludicrous excuses about a "Worldwide shortage of glass" stopping production, when in fact it later transpired that HBoS had frozen their banking service whilst PWC investigated fraudulent use of an invoice factoring service.
- The Directors refused to issue payslips for weeks when employees were not paid (Contrary to Employment law).
- The Directors refused to give staff employment contracts (Contrary to Employment law).
- The Directors ignored grievance letters from employees, and refused to keep minutes of the few meeting held.
- The Directors ignored communications from ACAS, Solicitors and Employment tribunals, etc.
- The Directors ignored multiple Employment tribunal judgements, as well as enforcement of the resulting judgements.
- The Directors tried to bully and intimidate staff into leaving, if they brought Employment Tribunal claims.
- Employees won all the Employment tribunal cases they started, and the Directors were severely criticised by all members of the Tribunal panels
- Employees complained to Companies Investigation Branch and the Police - who all ignored the matter.
- Staff were left poorer, stressed, suffering sleepless nights, and eventually unemployed.
- This situation has been repeated many times by the same Directors, putting yet more employees into the same scandalous situation.
Complete details of how the Workers were defrauded can be found at the Campaign to Stop Insolvency Abuse website.
Finally, it's worth noting that the Association of British Insurers severely criticises company pre-pack administrations, warning that they are being actively marketed by restructuring advisers as a convenient way in which to "dump debt" and start afresh, free of "troublesome" creditors; whilst we have also been contacted by employees from other businesses who have been similarly mistreated. So, this is not a unique or special case that Mr Blackman has been asked to address.
** update 1 **
A year and a half later, and after calls for his deselection as MP, Bob writes to express his sympathy with the "victims" of this scandal, and says:
In my view, the law needs to be changed to prevent "phoenix" companies from acting in [this] way...
Interestingly, Mr. Blackman also says that he had raised the matter in Parliament, in this question.
None of us can quite fathom what this has to do with workers having their wages withheld, since the comment seems more applicable to customers of a business than employees of a business, or why Bob Blackman kept the information secret for so long, and failed to mention it in his prior correspondence. But we're glad to hear that Mr. Blackman agrees that the law needs to be changed.
However, it's important to remember that in the past two and half years, there have been no improvements for the former workers, and Bob's voting record relating to Employment law shows that so far he has always been loyal to the Conservative party and their intention to implement the Beecroft report.
[The Beecroft report is a controversial document commissioned by David Cameron, and authored by Venture capitalist Adrian Beecroft (the man behind Wonga loans - who have been warned by the OFT over threatening debt collecting tactics), proposing that currently employment regulations unfairly benefit workers, and are allegedly strangling Britain's economic growth.]
** update 2 **
Bob Blackman did eventually raise the issue of employees being taken advantage of by unscrupulous company Directors in an Adjournment debate just prior to the 2012 House of Commons Christmas recess (meaning that many MPs had already returned home to their constituencies for Christmas).
However, since that time, Mr Blackman has have made no further effort to push this matter forward and has done nothing whatsoever to appeal the Department for Business, Innovation & Skills refusal to prosecute Directors (which was one of our first requests, and which Mr Blackman had initially claimed that he would be able to do).
Further updates will appear here, as they become available.
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