Snap decision saved livelihoods
Out of a job and in tears in the morning and back at work and running their own company by the afternoon.
It has been an emotional journey for some of the victims of a bankrupt Southland caterer Debra Monteith.
Alliance Lorneville Plant freezing works caterers Karen Dickson, Nikhil Rane and Sarah Ward had no idea the company they worked for was about to be liquidated in early 2024 until someone else who worked at Lorneville told them they had seen it in the news.
Monteith, their former boss, made national news this week when she was convicted and sentenced in the Invercargill District Court for failing to account for PAYE tax of more than $800,000.
When her company, Lee 19, was put into liquidation with liabilities of more than $2 million, the trio had been left suddenly unemployed.
Long-time caterer Mrs Dickson said they were stumped for a moment, but only briefly.
"It was like, what do we do? I was already 62 ..."
But they knew how to cater and quickly came to the conclusion there was nothing for it but give it a go themselves.
They found out Alliance Lorneville's management was on board if they formed a new company and Karen's Cafe was born more or less the same day, while the dust was still settling around them.
In doing so the women secured not only their own jobs, but those of nine other staff too.
Ms Rane said that February day when they decided to form their own company had been quite something.
"On Thursday morning, we went to work as an employee. Thursday when we came back home, I was an employer."
Single mother of four Miss Ward said there were a lot of tears when she first realised she was without a job.
Her main worry was how she would pay her bills, she said.
But there was not a lot of time to think about it and all three women went straight into "we need to get stuff done mode".
"When you have kids, you've got to figure it out. But thankfully Alliance gave us that opportunity and we're still there.
"Sometimes you just have to take the risk."
Since their snap decision, Karen's Cafe had grown and now also did off-site catering work which helped to keep business thriving during the freezing works' offseason.
While they had been paid regularly and on time up until Lee 19 went in to liquidation, the trio, along with Monteith's other staff, had all lost wages, including their final pays and holiday pay.
Another unsecured creditor, Southland Racing Club president Sean Bellew said the club had been left about $10,000 out of pocket by Monteith, who had been using their Ascot Park Raceway kitchen to operate a business that provided school lunches and catering for the Ascot-based racing clubs.
He said the club had parted ways with Monteith before the liquidation as they had already been experiencing issues.
Monteith admitted using the PAYE money over three years from 2021 to fund the business's operations, including food costs.
The court also heard she personally benefited by more than $300,000 over the same period, although she did not receive a formal salary and that Lee 19 also received over $780,000 in Covid-19 support payments during the same period.
Monteith was sentenced to 11 months' home detention.
By Toni McDonald
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