When a major client went into liquidation, quick action was needed
Waitangi Day 2013 was a lovely sunny Wednesday. I was in the garden pulling weeds when Josh, my senior staff member from our Construction Labour Hire team calls me and says he's heard rumours of Mainzeal going into liquidation.
My heart stops. We have 30-plus skilled construction staff on one of their flagship projects at Victoria University Wellington and they owe us a LOT. We had been in business for six years and although, well established, we were not equipped to take a hit like this.
My business partner and I had poured our hearts and souls into Key Skills Recruitment. I wasn’t sure how I was going to tell her this news.
I jumped into my car and immediately called one of the Senior Mainzeal Site Managers, a good friend of ours. I told him his company had gone bust. He was in the car with his kids and he hadn't heard a thing up to that point... I still feel bad about that.
I met Josh at the office. We went through all of our records to establish who we had working for Mainzeal and we started calling. They had tools on the site and needed them to work on any new assignments we got for them.
So many questions: how were they going to get their tools? Would they be paid for the for two days they had worked that week? The answer was probably not.
I looked closer at the accounts, Mainzeal owed us nearly $200k. Could we survive that? At that point I honestly didn’t know.
I tried to contact anyone I could to get answers for our staff. No-one could or would talk; we were simply directed to the liquidators. A big meeting was to be held at the VUW campus at 7the next morning. I couldn’t sleep knowing everything was on the line.
There was a crowd gathered, we listened to the receivers tell us that the site would remain in lockdown and there was no opportunity of retrieving tools and equipment until early the following week.
This news didn’t go down well with the crowd. No tools means no livelihood for them! There was a feeling of disbelief, frustration, anger. How could this possibly happen?
I met with the receivers and made the case for our workers, but the site was in lockdown.
I went back to the office exhausted and started the process of saving our company and looking my business partner in the eye. I called BNZ, our bankers (ironically it was BNZ that put the final nail in Mainzeal’s coffin) and I asked for their support.
We had to demonstrate our current position, the debt, our forward work load and luckily we received their support to get us through the next few weeks and months.
We were some of the lucky ones. Other subcontractors just watched as their livelihood, their hard work and their staff went down the gurgler. Marriages broke up, stress levels skyrocketed even suicide was discussed. How could this possibly happen?
We received confirmation on February 8 from Price Waterhouse Coopers that we would be allowed in the following day. I was the second contractor allowed on site and they would only let me in for one hour with one helper because they couldn’t allow a stampede of people “collecting” tools and equipment.
I collated a list of our workers’ tools and approximate locations knowing most of the tools were tagged with the workers names.
I waited downstairs in the unfinished “Hub” when I received a call from Marcus Lush’s team from RadioLive wanting to talk to me about our attempts to get the tools back. I explained it wasn’t the best time, maybe later in the day?
When we were in the building we were told to stick strictly to the one hour we had been given and that the lift was broken.
The tools and the tool boxes were heavy. I was picking up skill saws, drop saws, tool belts, safety gear and my sidekick and I were ferrying them downstairs – quickly. I am no gym bunny and I was suffering.
Half way down the six flights of stairs to the ground floor Marcus Lush called me - live on the radio. I could hardly speak as I was breathing so hard. I appreciated the support but the timing wasn’t awesome!
We got the tools out and they were returned to their owners.
Meanwhile, the team at the office was working hard to find work for our guys. They got everyone work and the construction industry was amazing to us. We received so many calls of support, it was overwhelming.
Finally I went home and collapsed into bed, I was exhausted. My business partner called me later in the day and woke me up from a deep sleep. Marcus Lush had named me as his Hero of the Day! We couldn’t believe it!
A week later our most loyal and wonderful, longest serving staff members came to us worried, wondering if their jobs were safe? Would they be able to pay their mortgage? Would our company survive?
They were being inundated with rumours from our competitors telling them we were on the ropes and that they should get out while they could.
For my business partner and I the trauma started again; if our staff left, we were at risk again.
We thoroughly explained to our staff the measures we had in place and what our great relationship with our bank meant for our business. We explained, they listened and they stayed.
There were many lessons for us professionally from this experience including the need to make sure labour-hire staff are communicated with and know you are looking out for their interests.
Our actions following the announcement the work site had closed were driven by a desire to look out for our business and our staff; the fact I was named Hero of the Day demonstrates that ethical behaviour is still very much valued in our community.