One of the UK’s largest employers of disabled people has announced it will be closing 27 of its factories, resulting in more than 1,700 potential redundancies.

Following a statement in March saying that 36 of its 54 factories were at risk of closure due to withdrawal of government funding, Remploy announced this week that it will be closing 27 factories, with a further nine up for auction. Currently, Remploy operates factories for various purposes, from manufacturing furniture and packaging to recycling waste electronics. Factories to close include Leeds, Manchester, Newcastle, Southampton and Swansea.

Along with the factory closings, operations at Boston Spa will end and the Cook with Care business will go up for bidding, putting 1,752 jobs at risk.

The decision to close the factories follows a period of consultation with trade unions and other employee representatives, and consideration of various business plans to limit redundancies and closures.

“The Remploy board and the government have done all we can to support bids and safeguard jobs… this includes a wage subsidy for disabled members of staff totaling £6,400and professional advice and support worth up to £10,000for employee led bids. On this basis, ninesites have had business plans accepted and will now move forward to the 'best and final offer' stage where detailed bids will be considered… Remploy is hopeful that these negotiations may lead to the transfer of business and retention of jobs”, said Maria Miller, the ministerfordisabledpeople at the Department for Work and Pensions.

In conjunction with the government, Remploy plans to offer incentive packages to employees who have been made redundant, including a three-year tapering wage subsidy of up to £6,400 for disabled members of staff, access to the Jobcentre Plus Rapid Response Service, tailored support from a Personal Case Worker, and other personal and community support funds. The support package is worth £8 million.

Miller offered sympathy and hope to those affected by the closures: “Undoubtedly, for those employees who have been told that their factories are closing, this is difficult news. But let me make one point absolutely clear. We are doing everything we can to ensure that Remploy workers who are affected will receive a comprehensive package of support and guidance to make the transition from government-funded sheltered employment into mainstream jobs.”

Remploy has stated its intent to consult individually with employees who are at risk of redundancy, and plans to open formal discussions with affiliated organisations about directly employing former Remploy employees.

Factories are expected to close between September and December this year, but redundancies may begin as early as August. Accepted bids for nine of the factories and Cook with Care are set to complete negotiations by the end of September.

Until recently, Remploy – which provides employment support to disabled individuals – has been one of the UK’s largest employers of disabled people, with more than 2,300 employees and 54 factories.

The factory closings represent the first stage of implementing government-announced changes on the recommendation of Liz Sayce, Chief Executive of Disability Rights UK, who said that segregated employment is not ‘consistent’ with equality for disabled people and that government money should not be subsidising segregated institutions, but supporting individuals.

The second stage of changes will be announced in the autumn, and are predicted to affect 18 factories in the automotive, e-cycle, furniture, packaging and textiles businesses, as well as CCTV contracts and Remploy’s employment services business.