Over the weekend, reports emerged that 230 staff working for the Caterham F1 team are to be made redundant.
We have been following closely the administration of the Caterham F1 team and its successful attempts to raise money through crowdfunding to secure a place in the Abu Dhabi Grand Prix. However as part of the insolvency process, redundancies needed to be made according to administrator, Finbarr O’Connell from Smith & Williamson.
A statement from O’Connell said, “It should be stressed that this is a necessary step in the overall restructuring process which has the ultimate aim of getting a new sound financial owner to take over the CaterhamF1 Racing Team.” In discussions, it was apparent that employees preferred to be made redundant to enable claims to be processed at the Redundancy Payments Office. Staff have not been paid since the end of September yet have worked for the last few weeks in order to keep the business going.
With Caterham now in the race, 40 employees (fully paid) will be taken to out to Abu Dhabi, thanks to last week’s crowdfunding campaign. It is hoped that the team’s participation will attract potential buyers for the business, resulting in possible re-employment in the future.
As with any insolvency process, like administration or CVAs, the company will need to drastically restructure in order to have a fighting chance of survival. In this case, it was unfortunate that redundancies had to be made, however it was the best option for the business at this stage in time.