Tuesday, August 21, 2018

Union Attacks Retail Magnate as Freight and Logistics Outfit Faces More Problems

Add Debt to the Woes of Troubled XPO
Shipping News Feature
UK – It seems 2018 is not a good year for US owned global freight and warehousing outfit XPO Logistics, a company that has of late been mired in allegations of sexual harassment and dangerous working practices, and which has now been forced to put 627 jobs at risk at its House of Fraser warehouse facilities following the retailer's recent failure, leading the GMB Union to condemn the action taken by the freight and warehousing company, and criticising retail magnate Mike Ashley for putting jobs at risk.

Earlier this month Ashley's sportswear company Sports Direct bought House of Fraser from its administrators for £90 million. Sports Direct is not obliged to pay the £484 million owed to House of Fraser creditors at the time of its collapse, including XPO which is owed £30.4 million. Ashley owned 11.1% of House of Fraser stock and we predicted the demise of the retailer after problems regarding its online order fulfilment and high street rental problems came to light.

Now, according to the union, members of staff at House of Fraser's warehouses in Milton Keynes and Wellingborough, both managed by XPO, were put on a 45 day consultation period, effective August 17. Alan Costello, GMB Organiser, said:

“This is a massive blow to our members based at depots in Wellingbrough and Milton Keynes who have been left in limbo. When companies like House of Fraser crash, history shows that asset stripping is often the consequence. You’ve got to question the motives for this buyout and ask whether Mr Ashley has got the interests of the company and its workers at heart.

“There are more than 600 people desperately worrying about their futures and how they’re going to be able to put food on the table for their families. It’s time for Mike Ashley to show that his rescue plan for House of Fraser is not simply a plan to boost his bank balance at the expense of House of Fraser workers and our members. GMB will be fighting hard to ensure members are treated fairly and to save as many jobs as possible.”

Following the buyout, XPO stopped accepting goods and processing orders at the House of Fraser warehouses in a dispute over payment, forcing the retailer to cancel online orders and refund customers. As is usual in these situations the GMB has been quick to criticise what is after all a legal move without any suggestion of a better solution. Ashley has a track record in retailing and has obviously acted with a view to protecting his interests, making a profit, or possibly both.

XPO management allowed a company that showed signs of problems to run up a multi-million pound debt and the business launched the staff consultation as soon as they felt the difficulties might prove insoluble. XPO has the resources to stand such a crisis but it would be good to hear the union produce their solution to this situation rather than simply criticise the legal buyer of a failed operation when no others appeared to be interested either in the company, or the fate of the workers at XPO and House of Fraser.

Photo: XPO has extensive facilities in Milton Keynes.