Sixty-six (66) workers of roofing producer, GGI Trinidad Limited will be sent home in 45 days, as the company goes out of business in a tough economic climate.
CNC3 Digital has acquired a copy of the retrenchment letter sent to all workers, advising that under the existing arrangements for the winding up of the company, it is very unlikely that they will be given any severance benefits.
The company's assets are being sold to Roof Systems Limited as it winds up on August 6th after going into receivership.
But the value of the company is below the amount owed to RBC Royal Bank (Trinidad and Tobago), making the payment of severance benefits almost impossible.
The letter reveals that RBC Royal Bank Limited appointed Maria Daniel and Zack Nadur as Joint Receivers-Managers on April 7th and they took control of GGI's business, property and assets.
They have continued since then to operate the company as a going concern.
Roof Systems to acquire assets
Staff were informed on May 24th that the company's assets were to be sold to Roof Systems Limited.
Workers received letters on Wednesday June 22nd (yesterday), giving them notice that they will be sent home in 45 days.
The letter reads: "The proposed sale of assets to Roof Systems is scheduled for completion on 6 August 2016. In consequence of the sale of assets, GGI will cease to operate as a going concern and its work force will become redundant.
"By this notice we inform you that your position has become surplus to the Company's requirements in the circumstances set out above."
The letter goes on to quote the Retrenchment and Severance Benefits Act Chap 88:13, as it informed that;
(i) the entire workforce is being retrenched
(ii) the reason for the redundancy is that the company will cease to operate as a going concern after the sale of its assets
(iii) that the proposed date of termination is August 6th
(iv) no specific criteria was applied for selection of termination, since the entire workforce is being made redundant.
No money available for severance benefits
The letter notes that Section 18 of the Act provides for the payment of severance upon retrenchment but makes it clear that under the circumstances, this may not be possible.
It states: "The Joint Receivers-Managers are under a legal duty to apply the monies from the sale of the assets and all other monies collected under their receivership in accordance in a particular order of priority starting firstly with the amount owed to the debenture holder, RBCTT (because of law, the amount owed to RBCTT as the debenture holder ranks in priority to all other payments including severance). There are other statutory payments which also rank in priority to severance."
The letter continues: "After paying RBCTT and satisfying all statutory and other payments which rank in priority to severance payments (such as rates and taxes), pursuant to Section 24 of the Retrenchment and Severance Benefits Act and Section 435 of the Companies Act, Chap 81.01, you will be eligible to be paid severance not exceeding the equivalent of two (2) months' basic wages or salary from the surplus remaining, if any."
The letter then goes on to give workers the real situation regarding severance benefits.
"Acting in good faith, we wish to let you know that based on the figures at hand, the oustanding balance due to RBCTT exceeds the purchase price to be paid by Roof Systems so that there is a likelihood that after paying RBCTT, there will be no surplus which can be applied to pay severance. As a further act of good faith, the Joint Receivers-Managers are seeking to negotiate with RBCTT to permit us to pay two months' severance or a part thereof but we cannot and do not guarantee that RBCTT will agree to this or that there will be any surplus funds to pay severance."
Workers told to report to work
The next line in the letter tells workers "you will be required to report for work during the notice period, unless otherwise advised".
Workers have also been told in the letter that they are permitted to get time-off to seek other employment, once a request is made in advance.
They've been asked to return all property that belongs to the company, by July 29th.
GGI Limited describes itself on its website as a company born in the mid-sixties that supplies quality aluminium and steel products.
In March this year, major steel producer ArcelorMittal shut down its operations in this country and sent home 700 workers.
ArcelorMittal's closure has impacted several downstream industries.
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