Balfour Beatty is reported to be planning to merge the location and management of its ground engineering, living places and Balvac business units and is consulting on redundancies.
GE’s sister title Construction News reported that a single management team will oversee the Balfour Beatty Ground Engineering, Balfour Beatty Living Places and Balvac businesses, in a move designed to cut costs after the business failed to hit revenue targets.
In a proposal seen by CN, Balfour states that the move was a response to trading difficulties, including BBGE turnover decreasing from £96M in 2016 to a forecast £58M for 2018, with new orders currently at less than 50 per cent of its target for 2019.
The proposal states that the business is legally required to start the consultation process 30 days before the first redundancy, meaning that according to government guidelines, between 20 and 99 redundancies are likely to be made.
The company said it would minimise redundancies by “replacing agency workers and redeploying people across Balfour Beatty wherever possible”.
Individual redundancy meetings are due to start the week before Christmas on 17 December, according to the internal document.
It said that BBGE had been unsuccessful on “a number of large bids” and been hit by projects including HS2 being pushed back.
Its rotary piling business had seen turnover drop from around £30M to an estimated £19M for 2018, and that ground investigation turnover was £1.5M off budget for the same period.
According to the contractor’s proposal, “the current high level of staff numbers in BBGE will not be supported by the forecast workload predicted in 2019”.
The proposed new management structure would see Steve Helliwell as managing director of the combined business unit.
Senior BBGE staff are understood to have already departed the business, including finance director Ken White.
Among the roles listed as “at risk” are director, work-winning, administration and supervisor roles.
A number of new roles will be created to reflect the merged divisions, including a head of rotary piling, preconstruction director and senior commercial manager for BBGE.
The three divisions will have a single work-winning team that will be located at a new office in Basingstoke.
The group is also proposing bringing the BBGE, BBLP and Balvac teams into one location in Derby.