Employees left unpaid since October

Architects at YRM have been left with thousands of pounds in unpaid wages after it emerged that the firm went into administration hours before being taken over by RMJM. Around 20 people lost their jobs 48 hours before Christmas with most owed at least two months’ pay.

Just five YRM staff have been offered roles at its new owner, including former chief executive John Clemow, who is now a principal at RMJM.

One ex-employee said: “We have not been paid since October. We’ve been given the runaround by directors who said we would be paid by the middle of November. It’s been a deliberate tactic to avoid staff breaking their silence before the senior staff could salvage their careers at a new company.”

The 67-year-old practice, which has been working on designs for a nuclear power station at Hinkley in Somerset, went into administration under a controversial “pre-pack” which allows the purchaser to buy parts of a company and leave any of that firm’s debts with the administrator.

Accountant Chantrey Vellacott DFK was appointed administrator on December 23 and RMJM took over the practice later that day.

Chantrey Vellacott DFK declined to comment but Clemow said YRM was in administration and admitted: “We approached RMJM [about a takeover].”

Clemow declined to confirm the arrangement of a pre-pack, and repeated earlier claims that the company had been brought to its knees by the cost of closing its offices in Vienna and Bucharest and falling workloads.

But ex-staff blamed management for a series of poor decisions. “This situation was almost inconceivable a year ago as YRM had a number of good prospects and a very successful and growing energy sector,” one told BD.

“It seems incredible that the very people who led YRM into this would be the ones continuing their employment.”

Another blamed the decision to open overseas offices, claiming the Vienna branch “pulled in no work whatsoever”. The source added: “The directors were on high wages and weren’t bringing in the work.”

YRM director Iain Macdonald has now been made principal at RMJM while associates James Thomas, project leader at Hinkley, and Peter Greiner plus architect Adrian Wiehahn will form a new London studio called YRM Lab.
RMJM chief executive Peter Morrison said YRM was a leader in aviation, nuclear and technology projects and added: “It significantly strengthens RMJM’s offer.”

Postscript:

What is a prepack?

Prepack administrations are controversial because they allow companies to leave behind debts – and a trail of creditors – with the administrator.

This week, high street retail firm Blacks was the latest to use the method writing off £36 million of debts.

A prepack usually means a company is put briefly into administration but only before it has arranged a buyer of its profitable assets. It’s not illegal but attracts criticism because it leaves creditors owed money while the firm resumes trading under a new owner.

But supporters of prepacks argue that without them, the situation would be much worse and that they at least help stricken companies keep going and avoid, in Blacks’ case, the need to make thousands of employees redundant.