ABOUT 200 workers at Linen Supply of Ireland are likely to lose their jobs after the examiner appointed to the company recommended the closure of two of its Dublin plants.
Linen Supply said yesterday that it deeply regrets that redundancies are likely, but said there was renewed confidence that a further 300 jobs at the company could be saved.
The company, which provides linen, towels and washroom hygiene products to hotels and restaurants, and uniforms and other textiles to retailers, has been hit by the downturn in the hospitality and retail sectors.
The examiner, Kieran Wallace of accountancy firm KPMG, who was appointed in September, proposed that the company’s plants at Fonthill and Naas Road in Dublin should be shut down as part of a bid to save other parts of the company.
The Fonthill plant employs 117 people, while 45 are employed at Naas.
A number of other jobs are also likely to be lost at Linen Supply’s headquarters at Park West in Dublin and throughout the rest of the company.
Linen Supply employs 566 people.
It also has plants in Galway, Cork, Limerick, Sligo and at Wilton in Dublin.
The examiner believes the company’s Micronclean plant in Spiddal, Co Galway, is a viable business and should be established as a separate entity. Some 69 people are employed at the plant, which supplies workwear to blue-chip technology and manufacturing companies.
Linen Supply, formerly known as CWS-Boco Ireland Ltd, was a subsidiary of a German company that employed 50,000 people worldwide and had a turnover of €779 million per annum.
However, Linen Supply has suffered trading losses since 2007 and was set to lose €5 million this year.
Employees’ wages make up almost half of the company’s costs.
Tara Devitt, head of human resources at Linen Supply, said it was a sad day for the company and the employees affected, but it was clear painful decisions would have to made in order to keep the business going.
“We will be meeting employees from these plants and their representatives in the coming days to discuss redundancy terms,” Ms Devitt said.
The examiner’s restructuring plan indicated that changes would be made to the terms and conditions of employment at its remaining plants, while the company will also have to secure rent reductions in Cork and Galway in order to survive.
The company also intends to move out of its headquarters at Park West.
“If we can get our costs down on those two fronts, we believe the company has a bright future,” Ms Devitt said.
