A FIRM running garages in Blyth and Morpeth has folded after 30 years of trading, putting 20 staff out of work.
RS Johnson, based in Coopies Haugh in Morpeth, has been forced to close after seeing a dramatic drop in custom and the loss of contracts to bigger competitors in Newcastle.
Owner Steven Johnson built the business up from scratch and oversaw its takeover of other garages at Scots Gap and Bellingham, but he has now been forced to call in receivers.
However, some workers have hit out at the handling of the closure.
Derek Saint, a recovery driver for the company for the last seven years, said: “I didn’t even get a phone call or a message to say it was closing. I heard through a third party that we had lost our jobs.
“I might lose my house, never mind anything else.
“I’m owed a month’s wages and two months’ overtime pay, and that is before we think about redundancy payment. It is looking like I’ll end up with nothing at the moment.
“I was told the receivers are in and dealing with it, but I have spoken to the insolvency agency twice and they don’t know anything about it.
“If it is registered insolvent, I can claim money from the government, but I can’t claim anything yet.”
However, Mr Johnson says he was left with no choice but to close the business and insists that all staff will eventually be paid.
“Everything is going through the receivers,” he said. “These people will get paid, but it will be going through the normal system.
“The bank closed our account, so I couldn’t physically pay anybody, but I am working with the administrators to sort that out as quickly as I can, so that people do get paid.
“I personally am the biggest creditor of the company for the cash I put in to try to keep it afloat.
“I put a considerable amount of money into the business two years ago to try to keep it going, but since January the work has just gone and I couldn’t sustain it any longer.”
He added: “I appreciate the staff. I employed some of them for eight, ten or even 20 years, and the loyal staff are still supporting me.
“A lot of them have got other jobs, and I have put a good word in for them where I can.”
The company began trading in 1981, initially specialising in servicing and repairing four-wheel-drive vehicles before branching out into vehicle recovery in 1985.
Other services, such as vehicle hire and bodywork repairs, were added later.
Just four years ago, its turnover was more than £2m and it employed 30 staff, but work rapidly dried up after the recession hit.
Mr Johnson, 55, of Morpeth, said: “Work just disappeared.
“Turnover has dropped by about 40 per cent since Christmas.
“Thirty years I have been in business, and I have been through recessions before, but nothing like this. This is the worst I have ever known it.”