Our IT manager called me today to ask if the antivirus program was the culprit and I indicated that it made no difference after it was disabled. When he went to re-enable the program he realized that it was not actually disabled yesterday. When he finally disabled it this morning everything started working again.
Anti-Virus program was Carbon Black.
Thanks for the reply. I believe the problem is resolved, hope this might help someone else in the future. I'll reply with any information he finds about why the antivirus program was interfering with the IDE.
(Sorry, I tried several example programs such as BLINK etc and I thought this was one of them since it was in the same directory and I didn't write it. Not sure exactly where this code came from if it's not an example sketch.)