On 22 May major cleaning company Swan Services, run by founder and owner Robert Swan for 43 years, went out of business, ‘putting 2500 cleaners across Australia – and an estimated 800 in Victoria – out of work’ stated a report by Stephen Cauchi in The Age.
Anthony Wayne Elkerton and David Gregory Young of Pitcher Partners were appointed Joint Voluntary Administrators of all companies trading under Swan Services, which claimed to be ‘one of the top five building cleaning companies in Australia’.
“The company has ceased to trade… a quick review made it clear that we, as administrators, were unable to continue operations,” said Elkerton, a partner of accounting firm Pitcher Partners. He informed The Age that the company was in the process of informing staff.
The union representing the cleaners, United Voice, said it hoped most of the cleaners would find new jobs. “As I understand it, they’re working to transfer the employees over to new contractors as we speak, so we hope they can hold onto their jobs,” said spokesman Anthony Reed.
United Voice’s national president Michael Crosby, said the union would be meeting with the administrators to discuss the issue of employee entitlements.
“Swan Services could potentially owe cleaners hundreds of thousands of dollars in entitlements, including annual leave, sick leave, unpaid wages, superannuation and we want to ensure they are protected,” he stated. “We are very concerned for the welfare of our members, who are largely low-paid cleaners working in office blocks, university campuses, international airports, government offices, retail and other commercial properties.”
“United Voice has been campaigning for six years for genuine reforms to the cleaning industry because of unsustainable tendering practices creating a race to the bottom among contractors,” Crosby said. “We fear Swan Services workers are the latest victims in a largely dysfunctional contract cleaning sector.”
John Laws of Australian Cleaning Contractors’ Alliance (ACCA) is another advocate against underhanded tendering. “This is bad news all round for the industry,” he stated in The ACCA Update newsletter. “Obviously the owners are suffering but the consequences are even worse for the many parties involved in that company. The many subcontractors have been left holding the can for hundreds and thousands of dollars with the flow-on meaning many of them will be tipped into bankruptcy as well.”
“As an industry we continue to tender for work at unrealistic prices. Just watch the greed that will manifest over the next week or two where contractors will try to obtain the work of that company. They will offer to do it for less or at he same price and the clients will happily accept,” Laws boldly stated. “One company went bust doing the work at these prices and others still think they can do the job at the same price.”
Swan’s collapse is the latest to hit the cleaning sector following Reflections, Pristine and Phoenix, all major retail cleaning contractors, which went out of business in the past three years. Industry sources have suggested there could be another two or three medium to large BSCs also experiencing financial duress.
INCLEAN has invited the Building Services Contractors Association of Australia (BSCAA) and United Voice for further comment and will post when received.
www.theage.com.au
www.cleaningcontractors.com.au
www.unitedvoice.org.au