Six-month reprieve for workers as CMI Industrial goes into liquidation

Administrators and receivers took control of CMI Industrial after talks failed to resolve unpaid bills with its landlord. A creditors' meeting then placed the failed car parts supplier into liquidation, with debts estimated at up to $40 million.

The liquidation process gives administrators the ability to look for a buyer, and as a result hundreds of workers have been guaranteed another six months' work while administrators pursue that option.

About 250 workers at four Victorian plants and 150 workers at a Toowoomba site in Queensland — roughly 400 employees in total — will continue to work during the six-month temporary reprieve.

Another 50 workers have been made redundant and are still waiting on a payout figure from CMI's receivers to understand the level of their funded entitlements.

CMI Industrial's debts are estimated at up to $40 million and include around $1.7 million in unfunded superannuation.

Yes. Officially placing the company into liquidation allows administrators to seek a buyer for the business or its assets, which could help save remaining jobs if a buyer is found.

Two weeks before the liquidation decision, the federal government provided General Employee Entitlements and Redundancy Scheme funding to help sacked employees recover some unpaid wages and leave.

The Australian Manufacturing Workers Union's Victorian secretary, Leigh Diehm, said members were shocked at how dire the company's finances were and the union plans to pressure the liquidators to investigate any possible financial mismanagement. CMI Industrial's administrator did not return calls for comment.