Fears over the future of personnel services firm Midland HR grew last week after sister company Zeda was put into liquidation.
The firm’s management refused to deny that jobs were at risk at Midland HR, which provides payroll and people management services to organisations including Virgin, Shelter and several local councils. The company refused several requests for comment.
Many Zeda employees logged on to internet forums after being made redundant to express their anger and warn staff at its sister firm of the dangers.
One who had worked for both firms told Personnel Today that Midland HR had showed “disregard for its employees”, and that he was “seriously concerned” for its staff.
Another wrote on the Nottingham Evening Post website: “I hope every one of the Zeda employees now gets a job working for a company that appreciates their efforts. People of Midland HR should leave now before the same thing is done to them.”
IT outsourcer Zeda, also owned by Midland HR chairman and chief executive John Mills, was suddenly placed into liquidation on 31 January. In a statement, Zeda blamed its demise on the tough economic conditions.
“The significant loss of business as a result of the impact of the credit crunch on many of our financial sector customers meant that there was no realistic alternative to placing the company into liquidation,” it said.
But many of the 120 employees who lost their jobs overnight were highly critical of the way the business was run. Everything from recruitment processes to the dress code was slammed.
“They said earlier this month that the future for Zeda was looking good,” said one angry ex-worker. “This does not happen overnight. The people remaining in the group may as well bin their contracts as this has set the precedent.”
Sign up to our weekly round-up of HR news and guidance
Receive the Personnel Today Direct e-newsletter every Wednesday
Founded in 1984, Nottingham-based Midland HR employs 300 people, and had a turnover of £21m in 2007.
Following publication of this story, Midland HR has declared that no redundancies will be made as a direct result of Zeda’s closure.
Managing director Lawrence Knowles said: “MidlandHR is stable, profitable and financially secure. The company has no borrowings and no debt. We have a proven and sustainable business, with over 300 customers, while our software rental model means our long-term repeatable revenues are very strong.”
