‘Bully boy’ claim as firm crashes with 250 jobs

DOOMED engineering giant Owen Pugh was the victim of ‘bully boy tactics’ its former head said as the firm crashed with the loss of 250 jobs.

A total of 257 redundancies have been made at the civil engineering group, just two days after administrators took over.

The company, which has worked on some of the region’s most prominent construction schemes, succumbed to cash flow problems.

Administrators say around 30 jobs at the firm’s aggregates division at Marsden Quarry could be saved.

But the rest of the business has been deemed “not viable”, leading to the closure of sites at Dudley, Cramlington, Blaydon and Stockton.

Former chairman John Dickson, who ran the business until August, said Owen Pugh had suffered recent bad luck, but had ultimately been brought down by some large contractors refusing to pay for work on major construction projects.

He said: “We ran out of money and we ran out of luck. I’m desperately sorry for what’s happened. I’ve lost a lot of money and I’ve lost my home.

“I’ve gone through three years of absolute hell trying to keep the business going and I’ve done everything I possibly could to make things work but it’s not been enough. We’ve had the most extraordinary bad luck and this is a particularly tough industry at a particularly tough time.

“I have to say that some of the companies we’ve worked for have shown a complete lack of moral scruples. Some of the main contractors are often just bullies.

“In most industries you will put in an invoice for your work and expect to be paid for 95% of it; we were sometimes getting 10 or 15%. The law allows companies to do that and there’s no incentive to behave properly. We could go to adjudication, but it would cost us £50,000 before it even started and all we’d get back is the original sum. There’s no penalty for the bad behaviour.

“This doesn’t happen in other countries and it doesn’t happen in other industries. It’s a thing that happens in construction.”

Owen Pugh dates back to 1946 and was acquired in a management buyout in 2005.

Administrators Chris Petts and David Dunckley, from Grant Thornley, were brought in on Monday but said yesterday most of the company could not be saved.

Mr Dickson said: “I’m desperately sorry for the people who’ve lost their jobs and for their families.”