A handful of employees at a major limo service have been left reeling by the company’s collapse, which has left them $4.14 million out of pocket.
News.com.au can reveal that on July 13, Brunel Chauffeur Drive and Limousines Pty Ltd went into liquidation.
Michael Hogan and Christian Sprowles of insolvency firm HoganSprowles have been appointed as the liquidators.
The company offered premium passenger transport in every state capital and also the Gold Coast, the Sunshine Coast and Cairns and was headquartered in Sydney. Some of its customers were private jet passengers who drivers picked up at the airport.
Brunel Chauffeur Drive had been struggling for some time, with its financial woes dating all the way back to the Black Summer Bushfires of 2019.
Its descent into liquidation has left 107 creditors cumulatively owed $11.7 million, according to liquidation documents obtained by news.com.au.
Among them is the Australian Taxation Office (ATO), seeking $5.1 million in unpaid taxes stretching as far back as March 2018.
But perhaps those who have lost the most in this scenario are the staff.
It appears the business had not been paying employees their superannuation for some time.
According to the ATO’s proof of debt claim, Brunel Chauffeur Drive’s outstanding superannuation total came to $1,867,091 including penalties.
Seven staff members are owed tens of thousands of dollars in salary, annual leave, superannuation, redundancy and payment in lieu of notice.
One worker is owed $31,000 in unpaid super. The lowest amount of superannuation owed is $7000.
Another employee is owed $35,000 in annual leave. Someone else is owed $22,000 in holiday entitlements.
The most owed to one employee was $92,000, followed by $79,000, followed by $75,000.
The employees will qualify for a government compensation scheme called the Fair Entitlements Guarantee (FEG), which seeks to pay back staff caught up in a company collapse.
Unfortunately there is a cap on the amount of money that can be paid, making it unlikely staff will emerge from this ordeal entirely unscathed.
Unpaid wages and long service leave are only paid up to 13 weeks while only up to five weeks redundancy pay is offered.
Additionally, unpaid superannuation is not part of the FEG and therefore employees are unlikely to get a single cent back on that front.
The liquidators noted “Pursuant to section 556 of the Act, the priority awarded to related party employee entitlements are capped at $2,000 for wages and superannuation and $1,500 for annual leave and retrenchment entitlements.”
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Brunel Chauffeur Drive has some assets including a fleet of 44 motor vehicles and six trailers.
The company had 16 vehicles not under finance estimated to be worth $406,000.
There was only $8.17 left in its bank account when liquidators took over.
“We have accepted an offer for certain assets of the Group, including intellectual property and vehicles, with the remainder of the assets likely to be sold at auction,” liquidators noted.
The company was established in 2003 and at its height in 2018, generated revenue of $27 million.
But in the years after that, things went rapidly downhill.
Brunel’s core customers included large airlines and hotels like Emirates, Qantas, Shangri La and Four Seasons Hotels.
Emirates, in fact, accounted for 49 per cent of the group’s total revenue, but in 2019 they were unable to negotiate a new deal with the Middle Eastern airline.
The Black Summer Bushfires then came along, impacting the number of tourists visiting Australia and also shutting down Sydney Airport multiple times due to smoke concerns, another blow for Brunel Chauffeur Drive.
Covid-19 reached Australia’s shores soon after, which was arguably the death blow for the limo company.
In the 2020 financial year, Brunel’s revenue dwindled by 52 per cent from $25 million the year before to just $12 million.
“On 21 April 2020, Virgin Australia Holdings Limited, a significant customer of the Company entered voluntary administration,” the report explained.
“This resulted in a loss of debtors in the sum of circa $200,000 which have not been recovered.”
Then in 2021, the company’s revenue shrunk further to “their lowest level” of just $1.3 million.
“The Group continues to incur losses with revenue unable to recover,” liquidators added.
The liquidators allege in their report, filed with ASIC, that the company had been trading insolvent since at least June 2020.
Brunel Chauffeur Drive and Limousines has been barely eking out a living for a number of years and has undergone several restructuring attempts.
Most recently, it went into administration on June 7, where six employees were immediately made redundant. Only three employees were kept on to carry on running the business while administrators looked for a buyer.
But with little interest, a little over a month later, creditors voted to wind the company up into liquidation.
The administrators became liquidators.
Prior to that, in 2020, receivers and managers were appointed but they managed to scrape their way out by receiving some outside investment.
And the year before that, in 2019, after losing a major deal, the group laid off a number of employees and transitioned to a subcontractor model.
alex.turner-cohen@news.com.au