Business

House of Fraser warehouse jobs at risk, union says

House of Fraser website Image copyright House of Fraser
Image caption House of Fraser's website has been taken offline

More than 600 jobs are under threat at two House of Fraser warehouses which supply deliveries to stores and customers, a union has warned.

The GMB said 627 staff at the two warehouses were told on Friday that they are at risk of redundancy.

XPO Logistics operates the sites, in Northamptonshire and Buckinghamshire.

Last week, the warehouse operator stopped processing orders due to a payment dispute, forcing the retailer to cancel and refund all online orders.

XPO Logistics was owed £30.4m by House of Fraser when the department store chain collapsed into administration earlier this month, according to administrator EY.

However, sources close to the the warehouse operator say this sum was inaccurate and that it was owed around £12m.

Image copyright Mulberry
Image caption Luxury handbag maker Mulberry has set aside £3m to cover House of Fraser's collapse

Mike Ashley's Sports Direct bought the chain just hours after it went into administration earlier this month.

This means it is not legally obliged to pay suppliers money owed before its £90m buyout, as their debts were part of the administration.

Mr Ashley says he intends to turn the chain into the "Harrods of the High Street", but it is not clear how many of the stores he will keep on.

XPO Logistics is one of a number of suppliers owed money due to the chain's collapse. In total, EY has estimated suppliers are owed £484m.

Union will 'fight hard'

Luxury handbag maker Mulberry said earlier it had set aside £3m to cover the retailer's troubles. It was owed about £2.4m when the department store collapsed and fell into administration.

The GMB said XPO Logistic's warehouse staff were put on a 45-day consultation period last Friday.

Alan Costello, GMB organiser, said it would fight hard "to ensure members are treated fairly and to save as many jobs as possible".

"You've got to question the motives for this buyout and ask whether Mr Ashley has got the interests of the company and its workers at heart," he added.

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