MORE than 1,000 jobs were lost yesterday after the North- East’s largest call centre operator collapsed into administration.

The majority of the 1,158 employees at Garlands were told they were being made redundant with immediate effect after the shock news was given over the company’s radio station.

Only a few staff have been asked to stay and manage the business in administration.

The news comes as the region’s business and council leaders urged the Government to help the region emerge from recession.

The open letter, signed by all 12 North-East councils and the Northern Business Forum, hopes to forge a new understanding between public and private sectors and the coalition Government over what is needed for the region.

Their move was given added impetus yesterday by the unexpected collapse of the Garlands call centre empire – one of the biggest in Europe.

The company, which employs 178 people in South Shields, 621 in Hartlepool and 359 in Middlesbrough, was founded by local-born multimillionaire Chey Garland.

At the height of their success, the centres handled 36 million calls a year.

Staff were able to relax in “chill out zones” containing sculptures, water features, and plasma screens. The company even had its own radio station, Radio Ga Ga.

Ms Garland, who received the CBE in 2007, said she had fought “tooth and nail” to save the business, adding it had taken: “Thirty years of hard work to build and just 18 months of economic recession to destroy.”

The end came after major clients terminated contracts with the firm, meaning the board saw no viable way to keep the company going.

The company said it could not say which clients had pulled out because of confidentiality agreements, although Orange and Vodafone have previously cut back on work with the company.

Staff were unaware of the problems the company was facing until the announcement was made at about 2pm yesterday.

Stephen Mullins, 30, of Thornaby, near Stockton, who has worked at the Middlesbrough centre for nearly four years, said the news had come out of the blue.

“Until they made the announcement we were losing our jobs, we didn’t know anything,”

he said.

“It has come as a complete shock.

“They announced the news on the radio station. They didn’t even bother telling us face to face.

“We all feel very let down.

We don’t even know what severance pay we are going to get for up to four weeks.”

College student Jake Gauntley, 18, of South Shields, said: “I was due to start my shift at 5pm, but at lunchtime I got a call from a friend to say he had heard I had lost my job.

“I didn’t know what he was talking about so I came to work early to find the building locked up.

“Two blokes I didn’t recognise told me I didn’t work there and that I should leave.”

PricewaterhouseCoopers (PWC) has been appointed administrator.

A PWC spokesman said: “As a consequence of the company having a number of key contracts terminated by clients, the directors have reached the conclusion it is not possible to support continuation of trading, apart from a single contract.

“Unfortunately, all staff apart from a number required to run this contract and a small number to assist the administrators in the closure of the business will be made redundant today.”

Ms Garland started in business in 1980 with a small debt collection agency. Since then, she has won a series of awards for her role in the industry, including business services entrepreneur of the Year in 2002, best business leader in the 100-plus employee category at the Sage Business Awards 2002, and the 2005 Veuve Clicquot Award for businesswoman of the year.

She was ranked 1,771 in last year’s Sunday Times Rich List.

In its most recent financial report, which covers to the end of October 2008, the group said its sales fell from £48.5m to £44.3m and that bottom line profits fell from £2m to £476,000 from the previous year.

In the past year, the company cut more than 200 jobs after Orange and Vodafone reduced business.

Garlands closed its Preston Farm site, in Stockton, in March last year.