JCB could make up to 950 staff redundant and hundreds more agency jobs could be axed as it buckles under the weight of the coronavirus pandemic, according to reports.
The construction equipment company’s production lines had announced a partial reopening of four UK factories earlier this week under social distancing rules. But the return to work only affected 400 staff, with most of the remainder of its 6,500-strong workforce in the UK on paid leave through the government’s furlough scheme.
Now up to 950 workers could face redundancy, with a 45-day consultation period to begin on Monday, according to the PA news agency and Sky News. Another 500 workers employed by the Guidant Global agency based on site are also said to be at risk.
A letter reportedly seen by PA from chief executive Graeme McDonald to staff said the company had little choice but to “take difficult decisions to adapt to this new economic reality.”
The privately owned company’s boss has seen demand tumble for its diggers, loaders and other equipment, a familiar sight on construction sites across the UK. JCB is one of the world’s biggest manufacturers for the construction sector, exporting around the world. It also has thousands of staff at factories overseas.
“In 2020 we had planned to sell and produce over 100,000 machines. With so much global uncertainty, that figure right now is looking more like 50,000 machines,” the letter reportedly reads.
“In the UK, around 85% of everything we manufacture is exported and our UK factories will now produce machines at half the rate we had planned just a few months ago.
“It is deeply regrettable that we have had to take these steps to restructure the business and that it will have an impact on so many people. No business could have anticipated the scale of the COVID-19 crisis and its economic consequences.”
Stuart Harrison, an organiser at the GMB union, said the announcement was “devastating to everyone involved.”
“As the recognised union, GMB’s senior representatives have entered into urgent talks about the future of the business with management. We will keep fighting to avoid job losses at all costs, for our members and their families,” he added.
JCB has been approached for comment.
A Guidant Global spokesperson confirmed JCB planned to reduce its temporary workforce in Staffordshire, Derbyshire and North Wales.
“Guidant Global, further to a decision to furlough its employees, has made the difficult decision to start the redundancy consultation process for those workers affected."
He added that the workforce would remain furloughed until the end of the consultation process on 3 July.
“This decision is not one we have taken lightly and over the coming weeks and months we will work closely with the workers directly affected to offer support and guidance during this difficult time.”