Another 70 employees of the collapsed Forge Group have been sacked after the loss of one of its remaining contracts, while those removed from its biggest project are being re-hired by another contractor.
Forge receivers KordaMentha and Horizon Power were unable to reach an agreement for Forge employees to complete the commissioning of a power station project in South Hedland.
The project had been one of just two Forge retained after about $1 billion in contracts were cancelled when the engineering firm went into administration last week with $500 million in debts.
KordaMentha is understood to have refused to accept a deal whereby Horizon would pay the wages of Forge employees on site so long as the receivers took responsibility for Forge's outstanding liabilities on the project.
"It is disappointing that so close to completion the Forge workforce has been released, despite our efforts to work with KordaMentha to complete the project with the existing workforce," Horizon managing director Frank Tudor said.
He said the project would be slightly delayed but there would be no budget blowout or impact on power supplies. Horizon was in talks with other contractors about completing the work.
The retrenchment of the South Hedland workers brings to 1470 the number of Forge jobs lost.
It leaves Forge administrators Ferrier Hodgson with one contract to complete - the troubled Diamantina power station project in Queensland, which has been the single biggest cause of Forge's demise.
Roy Hill Holdings yesterday said the 94 Forge workers sent home from Gina Rinehart's Pilbara iron ore project would be re-hired by labour provider Skilled Group, including senior project officers. Skilled said more than 50 workers had been employed by the weekend. Forge had held a $1.47 billion joint venture contract for Roy Hill project manager Samsung C&T to build a processing facility.
Skilled's involvement is a stop-gap measure designed to keep the work going until a new contract arrangement is made. A Skilled spokeswoman said the firm would continue hiring people while it was appropriate
A Roy Hill Holdings spokesman said continuity of construction was important to the project.