Feeds

Contractors lose out in Concept Telecom collapse

Risky business

  • alert
  • submit to reddit

Beginner's guide to SSL certificates

Several IT contractors have been left high and dry by the collapse into receivership of mobile phone testing and contracting services outfit Concept Telecom.

Following on from our story about an ad soliciting buyers for Concept Telecom in last week's FT, a number of contractors in the pay of the company have contacted us to explain their plight.

Nottingham-based Concept turns over £5m a year, according to the FT ad, of which £3.5m comes from contracting out engineers to telecoms clients and £1.5m comes from the company's mobile phone testing division.

As a result on Concept's slide into receivership, around 20 to 30 contractors are unlikely to receive payment in full for work carried out in February and March.

Receivers Tenon Recovery have not returned any of our repeated requests for comment, but we understand that it is telling contractors to submit their February timesheets. Receivers are telling contractors that they could receive 60 per cent of any money due.

So much? Was it really necessary to place the business into adminstrative receivership in the first place? For a potential buyer, the issue diminishes the value of the contracting services portion of Concept's business. After all what is the value of a bust recruitment company with no contracts?

Although the people who work directly for Concept might lose their jobs, contractors are in a worse position financially.

Under UK liquidation laws, staff the taxman and secured creditors (such as banks) are in a preferential position when firms are broken up. Contractors are treated as ordinary creditors and are far less likely to receive any money, two lawyers we contacted for legal background tell us.

Concept Telecom illustrates the greater risk that contractors take when the company they work for gets into financial difficulty.

As one of the affected contractors tells us: "Contractors losing out due to an agency going into receivership is something that is obviously very unpleasant. It's another unnecessary risk for the contractor, however something most contractors have not even heard of happening." ®

Choosing a cloud hosting partner with confidence

More from The Register

next story
I'll be back (and forward): Hollywood's time travel tribulations
Quick, call the Time Cops to sort out this paradox!
Musicians sue UK.gov over 'zero pay' copyright fix
Everyone else in Europe compensates us - why can't you?
Megaupload overlord Kim Dotcom: The US HAS RADICALISED ME!
Now my lawyers have bailed 'cos I'm 'OFFICIALLY' BROKE
MI6 oversight report on Lee Rigby murder: US web giants offer 'safe haven for TERRORISM'
PM urged to 'prioritise issue' after Facebook hindsight find
BT said to have pulled patent-infringing boxes from DSL network
Take your license demand and stick it in your ASSIA
Right to be forgotten should apply to Google.com too: EU
And hey - no need to tell the website you've de-listed. That'll make it easier ...
prev story

Whitepapers

10 ways wire data helps conquer IT complexity
IT teams can automatically detect problems across the IT environment, spot data theft, select unique pieces of transaction payloads to send to a data source, and more.
The total economic impact of Druva inSync
Examining the ROI enterprises may realize by implementing inSync, as they look to improve backup and recovery of endpoint data in a cost-effective manner.
Getting started with customer-focused identity management
Learn why identity is a fundamental requirement to digital growth, and how without it there is no way to identify and engage customers in a meaningful way.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security and trust: The backbone of doing business over the internet
Explores the current state of website security and the contributions Symantec is making to help organizations protect critical data and build trust with customers.