Administrators for Readie Construction have still not received any of the £4.8m owed by its parent company.
Readie Management Ltd, the ultimate parent of the contractor, was wound up at the High Court in April 2024, with its liquidation being carried out by the Official Receiver.
A new report from administrators at Begbies Traynor, published this week, revealed uncertainty over whether any of the money owed by the company will be recovered.
Readie Construction went under in February 2024 with creditors claiming more than £43m in owed money.
So far, just £654,400 has been recovered through money owed to Readie.
The latest report estimated that £1.5m-£4.2m will be recouped through this process, with either end of the range representing the worst and best-case scenarios, according to the report.
But this money will go entirely towards tax debts and the costs of running the administration, the report said, with HMRC owed an estimated £8m.
Former employees were owed a total of £494,400 for wage arrears, salary and holiday pay.
Cash for ex-workers of defunct companies is paid out by the taxpayer-funded Redundancy Payments Service, which then seeks to recoup costs via administrators.
In January, an employment tribunal ruled that Readie breached section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 by not holding a formal consultation process before laying off its staff.
A judge at the East London Tribunal Hearing Centre said the company failed to show there were special circumstances for the failure to consult.
He ruled that the workers were entitled to a protective award, but the amount of compensation was not revealed.
The case was the latest in a long line of similar actions taken against defunct contractors following a test case in January 2021 involving Carillion.
Cash awards in such cases are also paid out by the Redundancy Payments Service, rather than the former company.
Readie, which was headquartered in Romford, east London, was a main contractor specialising in industrial buildings.
It employed around 260 employees in its final year of trading. Readie’s turnover soared from £195.9m, in the year to 31 March 2020 to £421m in the year to 31 March 2023.
The firm was sold to an employee-owned trust in March 2021, and paid £6.2m in contributions to its former owners over the next two years, a period during which it posted an aggregate pre-tax loss of £100,000.
It blamed factors including inflation, costs on fixed-price contracts, two mechanical and electrical subcontractors going under and increased difficulty in obtaining trade credit insurance and bond sureties for its collapse.
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Ian Weinfass