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Carcraft workers take legal action after collapse

Former staff of the nationwide used car dealership Carcraft, which had a branch in Wednesbury, are looking to mount a group employment action against the business.

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The firm's 500 employees across England and Wales, including 60 in the Black Country, were made redundant immediately after the firm went into administration at the end of April.

It was later revealed that it had been making multi-million pound losses for several years.

Carl Moran, an employment law partner at JMW Solicitors in Manchester, said he had been contacted by a number of Carcraft personnel anxious to make a claim against the company.

Mr Moran and his colleagues recently lodged employment tribunal proceedings on behalf of 350 workers of the collapsed parcel carrier City Link.

He said that despite operating in different industries, there were similarities in what action was open to those left jobless by Carcraft's demise.

"Some of those people who have contacted us in the last few weeks have been surprised to learn that they could still pursue a claim even after receiving their April wages on the day that the company closed.

"However, anyone who is dismissed with little or no warning is entitled to up to 12 weeks' notice pay, depending on how long they have worked for a firm, and as much as six weeks' holiday pay too.

"Furthermore, if they worked at a site with more than 20 employees, they can become part of a collective bargaining group and seek up to eight weeks' pay as additional compensation.

"Whatever money individuals can rightfully claim isn't paid out automatically, though. They need to make a claim and, in the case of the additional, protective award, that involves beginning employment tribunal proceedings," explained Mr Moran.

Administrators Grant Thornton took charge of Carcraft's affairs on April 30 after beginning work with one of its sister companies a fortnight before.

By the time of its collapse, Carcraft was the UK's seventh-largest second hand dealership, turning over £120 million through a network of 10 depots, including its headquarters in Rochdale and the other sites at Darlaston Road, Wednesbury, Sheffield, Leeds, Enfield, Stretford, Newport, Birtley, Chertsey and Thurrock.

Another depot, in Liverpool, had shut with the loss of 30 staff at the end of March.

The administrators claimed that a number of factors were responsible for the firm's ceasing to trade. It had, they argued, suffered from competition and a poor reputation, conditions which had led to the business recording losses of roughly £8 million per annum for a number of years.

They disclosed that Carcraft also had the added burden of 'legacy PPI claims'.

In January, Mr Moran won a three-year battle and a six-figure payout on behalf of 120 former employees of a Lancashire-based call centre business, Sitel UK.

He said that despite the administrators warning motorists that they were unable to honour warranty packages sold by Carcraft, ex-employees were still able to advance their claims.

"If there are insufficient funds at the disposal of the administrators to meet whatever claims are considered legitimate, the National Insolvency Service, backed by the Government, will pay up.

"It is important, though, to realise that speed is very much of the essence. Those who qualify for collective bargaining claim must commence the employment tribunal process within three months less one day of Carcraft closing its doors," he added.

Former Carcraft staff can contact JMW on 0845 872 6666.

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