RTL Today - Bankruptcy at Manuel Cardoso: Concerns mount for employees ahead of collective holiday

With the prospect of a companywide break just days away, time is running out to support the workers at Manuel Cardoso, a residential construction company on the brink of bankruptcy.

All hands are on deck to support the employees of Manuel Cardoso before the collective holiday. On Tuesday morning, the Independent Luxembourg Trade Union Confederation (OGBL) and the Luxembourg Confederation of Christian Trade Unions (LCGB) attended an information meeting with the 110 employees facing job losses. Manuel Cardoso, a company which has been in business for 42 years and specialises in residential construction, will be filing for bankruptcy.

Recent months have seen Manuel Cardoso grapple with an array of problems, including unfinished projects, delayed payments, and a sluggish market, leading to salary payment difficulties and the loss of several employees. From a workforce of 150 at the beginning of the year, the number has now dwindled significantly.

"Virtually all the staff attended the meeting on Tuesday morning," explains Jean-Luc De Matteis, the OGBL's central secretary for the building, craft, and metal construction industries. "Everyone was very dignified, very attentive, and very calm," despite the stressful situation. For the time being, the staff has been excused from work.

Employees about to go on holiday

The impending closure comes at an unfortunate time, coinciding with the start of the collective holiday on 28 July. The employees are scheduled to be on leave, making it crucial to take immediate action. To this end, the OGBL and the LCGB have collaborated with the company to compile essential documents, such as pay slips, required for employees to access aid granted during a company's bankruptcy. Request should ideally be made this week, or alternatively next week, during the collective holiday.

A meeting with the National Employment Agency (ADEM) is scheduled for Wednesday to facilitate the staff's registration before they go on holiday. Detailed information on registering as a resident or non-resident jobseeker, employee's debt guarantee in the event of bankruptcy, advances on salary arrears, and claiming unemployment benefits will be provided during the session.

Jean-Luc De Matteis, OGBL Central Secretary for Building, Craft, and Metal Construction. / © Didier Weber / RTL

"Whether the company has the money or not, people are entitled to it," LCGB deputy general secretary Christophe Knebeler told our colleagues from RTL Radio on Tuesday morning.

Despite the uncertain situation, some hope remains as certain employers in the sector have expressed interest in hiring Manuel Cardoso's displaced staff, according to De Matteis. It's a period of uncertainty, but "not everyone is in crisis." In fact, Luxembourg's low unemployment rate and demand for qualified labour offer a glimmer of optimism amidst the challenging circumstances.

Part of the sector still under threat

However, the entire residential construction sector faces adversity, with orders and building site activity slowing down. In addition to the small-sized companies that have already gone out of business, the LCGB claims that another company with more than 100 employees is in a very tense situation. On Tuesday morning on RTL Radio, the LCGB's deputy secretary general spoke out in favour of a job preservation plan for construction companies in difficulty.

The OGBL also admits that there are risks for some companies. For the time being, however, there are "no other imminent bankruptcies."

In addition to the difficult circumstances in the construction industry, the difficult negotiations for a new collective labour agreement further compound the sector's challenges. However, the trade unions claim that they encountered these difficulties even in more favourable economic times.

Knebeler rejects the Competition Authority's suspicions of a cartel between companies to keep wages down. He describes these rumours as a "disgrace" and an "absurd conspiracy theory."

Whatever happens, monetary and property policies will continue to influence the construction industry. Rising interest rates limit credit accessibility, while concerns persist over limited and concentrated property holdings in Luxembourg, exacerbating access to housing, the number one concern for residents.