A High Court judge has appointed provisional liquidators to a recruitment company employing 290 people.
Most of the employees of ECS Recruitment Ltd work for customers as agency staff and the plan is that contracts will be licensed out and sold, rendering it possible for the 277 agency staff to continue working for the customers, the court heard.
The petition for the appointment of provisional liquidators was moved on Wednesday by barrister Ross Gorman, on behalf of the company whose sole director is Daniel Curtis of Churchtown, Athy, Co Kildare. The company’s registered office is at Leinster Street, Athy, and it operates from premises at Citywest Shopping Centre, Saggart, Co Dublin.
Mr Justice Alexander Owens was told the company was incorporated in 2018 for the business of providing and recruiting temporary and part-time staff for customers.
It largely serviced the hospitality sector initially and experienced very difficult trading conditions difficulties during the Covid-19 pandemic due to the business restrictions imposed.
After those restrictions were lifted, its trade began to recover, it diversified into servicing the construction industry and experienced strong trade between September 2020 and 2022.
During 2022 to 2023, a number of its clients in the hospitality sector changed the use of their hotels and began offering accommodation for migrants, it was stated. That reduced the demand for the company’s services and it began servicing clients in the finance, healthcare and pharmaceutical industries. In recent times, an increase in contractor costs and administrative expenses reduced its margins.
The company, the court heard, has made losses since 2022 and is currently insolvent. Its largest creditor is the Revenue Commissioners, owed more than €1.1m in PAYE/PRSI (€493,081) and VAT (€715,759). While the company made some payments under a phased arrangement with the Revenue, its attempt to have that arrangement extended for 10 years was refused.
Another substantial creditor is invoice finance provider, Close Brothers Ltd, owed some €362,875.
In late August, the company accepted its insolvency and a process adviser was appointed by Mr Curtis under the Small Companies Administrative Rescue Process, to devise a rescue plan.
Revenue’s subsequent indication it was opting to have its debt excluded from that plan, and wanted it paid in full, led to Mr Curtis indicating he was not in a position to invest in the company. As a result, the process adviser formed the view he could not devise a rescue plan and the company should be placed in provisional liquidation.
That led to Wednesday’s application, which was supported by counsel for Revenue. On foot of the evidence, Mr Justice Owens made orders appointing Dessie Morrow of Azets Ireland and Declan Haney of Crowe Ireland as provisional liquidators.
They were granted powers including to preserve the assets of the company, to licence the business of the company to a third party and to sell the business of the company.
Sign up for the Business Today newsletter and get the latest business news and commentary in your inbox every weekday morning