Carlauren's Heritage Hotels staff not paid last month due to ‘cash flow problems'

15 November 2019 by
Carlauren's Heritage Hotels staff not paid last month due to ‘cash flow problems'

Dozens of staff working at properties belonging to Heritage Hotels, a subsidiary of the Carlauren Group, were not paid in full last month due to "cash flow problems".

However Carlauren chief executive Sean Murray has said all money owed will be paid by the end of the month.

A letter sent to employees, seen by The Caterer, dated 31 October 2019 from chief operating officer Andrew Jamieson, who is no longer employed by the business, said the group was not able to pay October salaries or weekly wages that day with a ‘provisional' payment date given of 5 November. However, many staff are understood to have still not been paid in full and approximately 40 of the company's 180 staff have either resigned or been made redundant.

Murray told The Caterer the group is "getting through" the cash flow issues, adding that more than three-quarters of staff had been paid with the rest owed "no more than £60,000" in total.

The Caterer has spoken to several employees who have either been paid in part or not at all since last month. Although Murray said the company has arranged emergency payments for staff who need them through property managers, staff spoke of having to seek other lines of credit in order to pay rent, mortgages and bills.

"We're still going in for the fact that it's not the guest's fault… we're going in for them," said one hotel worker. "We keep getting told that it's coming but it never comes."

Another member of staff said overdraft charges were costing them £15 per day. "I have accepted that I'm not getting my money," they said.

Murray said he had taken "full control of the business" and anticipates it will be "back on track" within the next three weeks. He said all remaining staff would be paid in full by the end of next week, while those who have left or been made redundant would be paid by the end of the month.

He blamed the cash flow issues on Carlauren Group's upcoming court appearance, which he said has meant the company has had to rely on income and trading revenue.

He said: "This position will not be the same next month because we would have addressed all the concerns we have now that I'm in full control."

He added: "I am so grateful for the staff that we have at the moment that are running the businesses and going through this very difficult time."

Carl Jackson and Simon Bonney of Quantuma were appointed joint administrators of Carlauren Lifestyle Resorts on 25 July 2019, the group's care home business, which did not own any of the hotels.

Carlauren Lifestyle Resorts previously traded the hotels but that ceased prior to the administration, and staff were transferred to Heritage Hotels. The High Court is due to hear an application to put non-trading holding company Carlauren International Holdings into administration later this month.

Heritage Hotels has nine properties including: Eton House in Yeovil, South Somerset; Auckland House on the Isle of Wight; Dean Valley Manor in Lydney, Gloucestershire; the Coppice hotel in Torquay, Devon; Langdon Court in Plymouth; Lambert Manor in Grange-over-Sands, Cumbria (pictured); the Headway hotel in Morecambe, Lancashire; Tyndale House in Yeovil, Somerset; and Arbour hotel in Barmouth, Gwynedd.

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