A Polish company announces mass layoffs. He has enormous debts

The Polish manufacturer of boilers and environmental protection equipment, Rafako, has launched a group layoff procedure. The decision results from the deteriorating financial situation of the company, which has been struggling with difficulties for years. The company’s management emphasizes that reducing employment is necessary in the face of the planned restructuring and the recently filed bankruptcy petition.

Collective layoffs. Details after consultations

At the end of September, Rafako announced a debt exceeding PLN 675 million, of which PLN 470 million are arrangement liabilities and PLN 35 million are receivables paid by Alior Bank to JSW Koks. The company also has liabilities to the Lithuanian company VKJ in the amount of PLN 70 million and received PLN 100 million of public aid, which it must return.

Rafako has not yet disclosed the number of people covered by group layoffs or the exact restructuring costs. This information is to be determined during talks with trade unions. The company emphasizes that the decision to file for bankruptcy is a solution intended to protect the interests of creditors, shareholders and employees.

Rafako’s vice-president, Cezary Klimot, assured at a press conference that the company’s employees will receive salaries in the coming months, but further decisions will depend on the actions of the bankruptcy trustee.

Years of problems and attempts to fix it

Rafako has been struggling with the crisis for five years. The company made further restructuring attempts, introduced recovery plans and concluded settlements. The company’s management also changed. During the 2023 election campaign, Donald Tusk visited the Rafako staff, declaring support for saving the company.

Despite these actions, in 2023 Rafako recorded consolidated revenues of PLN 335 million, which was not enough to protect the company from having to file for bankruptcy.