The Unite union has launched what it calls a blueprint to stop future Carillion-style company collapses.
It has recommended a package of measures in a report called Ending bandit capitalism: Learning the lessons from Carillion’s collapse.
The report looks at the circumstances of Carillion’s collapse and the role played by the directors, government and Carillion’s auditors.
There are also chapters examining how the construction industry is organised and how public sector contracts are outsourced, which the union claimed were both “major contributory factors” in Carillion’s demise in January this year.
The recommendations in the 36-page document include:
• Requiring directors to focus on the long-term welfare of the company rather than short-term profits
• New rules which bar companies from prioritising dividends, bonuses and director’s pay over reducing pension deficits
• Not awarding public contracts to companies in financial difficulties
• If a major company collapses government support for sub-contractors and its supply chain should be for the long-term
• “Radical” reform of the regulatory system with the number of regulators being reduced and those that remain being given “real power and teeth”
• An end to the “current outsourcing culture” with contracts being brought back in-house at the earliest opportunity
• A transformation of employment laws to ensure unions have access to workforces to organise workers and prevent exploitation
• A reduction in the number of legal hurdles that must be cleared before cases taken for workers who were employed by a company in compulsory liquidation can go forward
Unite assistant general secretary Gail Cartmail said: “This document is designed to set out the many factors that led to Carillion’s collapse and to ensure that the bandits are chased out of UK plc.
“What is too often forgotten when company’s collapse is that thousands of workers both directly employed by the company and in their supply chain lose their jobs, through absolutely no fault of their own. The untold human misery of being dumped out of work without warning must be tackled once and for all.
“The reforms that Unite has set out provide a clear blueprint of what is needed to begin tackling the worst excesses of the financial and corporate culture which currently exists.
“It is a damning indictment that nearly a year after Carillion’s collapse no one has been charged with doing anything wrong, yet thousands of workers lost their jobs and millions of pounds of taxpayers’ money has been spent on clearing up the mess.
“Perhaps the most worrying factor concerning Carillion’s collapse is that the government is still acting as though it is business as normal, which is potentially exposing thousands more workers to a Carillion-style meltdown.”
