Axed Gateshead factory workers must wait until January for pay-off

A factory worker has told how many of his former colleagues are "broken" after being told redundancy payments due on Friday were being delayed.

In August fruit and juice supplier Orchard House Foods announced plans to close its Gateshead base putting 430 jobs at risk.

Many workers were due pay-offs on Friday but the firm emailed to say it could not pay them until January.

The company said various factors were having a significant financial impact.

Stephen Taylor, who lost his job, said the fear now was that former employees would never receive what they were owed.

The firm switched production from Gateshead to Corby in Northamptonshire in August.

Some staff had the opportunity to relocate to the Midlands, but hundreds have now been made redundant with the remaining staff doing their final shift on Tuesday.

Orchard House Foods, which supplies the likes of Marks & Spencer, Tesco and Pret A Manger, blamed rising costs and a shortage of staff for its decision to shut the Gateshead site.

In a statement, the firm said: "We would like to apologise to all our former colleagues following the delay in the payment of their redundancy money.

"Since we announced the closure of the Gateshead site, the severe inflationary pressures and other issues in the food industry have worsened.

"This has contributed to falling sales and had a significant financial impact on the business.

"We are working with our banks and shareholders to secure additional funding but regrettably this is taking longer than anticipated."

It added that the firm was "confident the situation will be resolved in the new year" when staff would receive all money owed to them.

The decision to relocate production came 18 months after UK private equity fund Elaghmore purchased Orchard House for about £25m.

A statement from Elaghmore said: "The banks and shareholders continue to support the business. Everyone is working hard to find a solution to the company's current financial challenge."

Mr Taylor, a shift operations manager, had worked at the Team Valley factory for five years and was not due to receive three months' salary until 31 January.

He said those workers who had been promised money before Christmas were facing "financial hardship".

"People are just broken. To get an email saying you aren't getting your money, it's just awful and because the payment hasn't come the concern is that it won't come at all, " he added.

"Orchard House should do the right thing and pay the money. We worked until the end of our contracts and we all left with pride, because it was business as usual until the factory closed."

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