What kind of company is Noonan, the LSE’s cleaning contractor? Should the LSE do business with them?

Noonan Services Group is the facilities management company that the London School of Economics (LSE) employs to operate its cleaning services. The company is owned by Alchemy Partners, a Guernsey-registered private equity company that Bloomberg online describes as a ‘vulture’ firm who invest in ‘distressed’ businesses for lucrative gains.[i] Between its formation in 1997 and 2004, Alchemy was reported to have made a return of £1bn for investors, including Goldman Sachs Asset Management and British Aerospace investment fund. [ii]

Alchemy bought Noonan for €90 million in 2008 but is now reportedly looking to sell the company this year for more than double that price – around €200 million. Noonan’s sale will rake in a tidy profit for Alchemy’s rich investors and it will further enrich Noonan’s directors who have substantial share-holdings.[iii] This is on top of the fact that in 2015 Noonan had record revenues of €303m, up €100m on the previous year, with pre-tax profits rising from €5.5m to €11m. [iv]

Noonan’s business model is like that of all outsourcing firms: the company offers various types of facilities management service including cleaning services to organisations which want to save money and reduce their responsibility and liability by employing an outside contractor. Outsourcing firms claim that they can run services at a lower cost than their clients by finding ‘efficiencies’. The reality is that this involves either cutting staff, increasing workloads or employing them on inferior contracts.

This is why cleaners at the LSE have significantly worse pensions, derisory sick pay and much worse annual leave than their in-house counterparts – it’s part of the Noonan business model. Put simply, Noonan’s profits represent millions of pounds being taken out of the pockets of low paid workers, who are often women and from migrant backgrounds, and put into the hands of Noonan’s exclusively white and male executive board.[v]

Noonan’s CEO John O’Donoghue received a salary of €272,719 in 2015, while between them the company’s eight directors took home a total of €1.2 million in salaries alone.[vi]

Noonan is intent on squeezing every last drop of labour out of its workforce at the LSE and is also willing to discard employees when it thinks it can’t get any more out of them. This is what happened with Alba Pasmino, a cleaner at the LSE who was summarily and illegally sacked from her role with two days notice after 12 years service in late 2016.

It appears that this sort of approach to redundancies is by no means the exception in Noonan. In December last year a contract cleaner who had worked for the company for 15 years in Ireland successfully sued Noonan for unfair dismissal and was awarded €8,160. At the trial the Irish Labour Court found that Noonan’s ‘procedures were “fatally flawed” and the employee was not afforded her right to natural justice or fair procedures.’[vii]

In January 2016 Noonan were forced to pay out €50,000 to a woman they had discriminated against for being pregnant, and were also forced to meet with the Equality Commission for Northern Ireland to ensure compliancy with equality legislation relating to pregnancy.[viii]

Cleaners at the LSE know from bitter experience what Noonan’s employment practices are like. To say that Noonan management is oppressive and overbearing is an understatement: the cleaners at the LSE are constantly monitored while at work (it seems that this control freakery even extends to the monitoring of social media accounts) and are often subjected to harsh disciplinary action for the smallest of supposed infractions.

There are also several examples of cleaners being bullied and harassed by managers at the LSE and other sites where Noonan holds the contract. Disgracefully, this includes discrimination by a Noonan manager against a cleaner for being gay. In that case they had received reports that homophobic hate crimes were being committed against a cleaner who feared for his safety. Instead of immediately suspending the perpetrators pending investigation, as is standard practice, in order to ensure the safety of the victim and other potential victims, Noonan didn't even start to investigate the matter for 2 months.

Noonan’s callous and oppressive management style is exemplified in their recent treatment of one of their longest serving cleaners – a woman in her sixties who is a great-grandmother and who has worked at the LSE 11 hours a day for the last 16 years. She has recently been dragged through four meetings and issued with a final written warning simply for taking two minutes during her shift to rest her injured back and knee - injuries she suffered during an accident at work.

Meanwhile, the company has been dismissive of complaints by cleaners who say they are being overworked and are suffering physical pain as a result. In fact, Noonan has gone much further than simply disregarding the concerns of overworked cleaners; it has actively sought to discourage and undermine those cleaners who raise complaints or who support the campaign for improved terms and conditions at the LSE. Noonan have also tried to encourage cleaners to change trade unions and to discourage them from taking part in lawful industrial action by unlawfully suggesting that it might put their jobs at risk.

On top of this Noonan have tried to ban the cleaners’ chosen trade union representative from representing them. The company’s trumped up justification for the ban has been proven to be false. However, regardless of the credibility of the justification, the act is still in breach of employment law, trade union law and human rights law, which Noonan seem to feel free to disregard at will.

Management have also used the tactic of reserving and distributing overtime hours in an attempt to divide and control the cleaners and to deter them from taking part in the recent industrial action. Several cleaners who are members of the trade union United Voices of the World (UVW) have suffered bullying and harassment and are currently suing Noonan for trade union victimisation.

The LSE should reflect carefully on what sort of an organisation it has employed to deliver one of the most important functions at the university. While the LSE constantly claims to care about its cleaners, it appears happy to stand idly by and let Noonan trample all over their rights. The LSE must finally start to show some compassion and respect for its cleaners by re-evaluating its relationship with Noonan.

NOTES:

[i] ‘Company Overview of Alchemy Partners LLP’: http://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=18677

[ii] ‘Alchemy on course for £1bn pay-out’: http://www.ft.com/cms/s/0/0c6a23ce-d533-11d8-8f7c-00000e2511c8.html?ft_site=falcon&desktop=true

[iii] ‘Alchemy eyes Noonan Services sale for up to €200m’: http://www.irishtimes.com/business/retail-and-services/alchemy-eyes-noonan-services-sale-for-up-to-200m-1.2790038

[iv] ‘Revenues surge to €303m in “record year” for Noonan’: http://www.independent.ie/business/irish/revenues-surge-to-303m-in-record-year-for-noonan-34750133.html

[v] See http://www.noonan.ie/about/our-team/

[vi] See Noonan Topco Limited’s (Noonan’s parent company) accounts for the year ended 31 December 2015, p. 45.

[vii] ‘Noonan Services Group Limited -v- Elvira Kravcova’: http://www.lexology.com/library/detail.aspx?g=fc6dd232-9b05-4e3c-865a-9bdcd3ebdac7

[viii] ‘£50,000 for finance manager made redundant after having baby’: http://www.equalityni.org/Footer-Links/News/Individuals/%C2%A350,000-for-accountant-made-redundant-after-having#sthash.D43S9jJq.dpuf