Sears Canada gets court approval to begin soliciting bids for its sale

Sears Canada announced in June that it planned on closing 59 locations across the country and cutting approximately 2,900 jobs as part of a restructuring under the Companies’ Creditors Arrangement Act.

The department store owner wants to shutter dozens of stores in the coming weeks while it negotiates with potential buyers who might acquire some or all of the company’s remaining assets, pending court approvals.

“I’m in total shock this happened,” said Zobedida Maharaj, who was one of dozens of former employees who packed an overflowing Toronto courtroom to hear Thursday’s proceedings.

Maharaj, 53, said she had worked at Sears Canada for 28 years before she was laid off at the end of March when her store was closed.

The senior manager of operations and merchandise said she was initially told she would get eight weeks of severance and benefits, but was cut off June 22 when the company secured temporary court protection from creditors.

“It’s like getting slapped in the face,” Maharaj said.

Earlier in the day, Sears Canada struck a deal over benefit and pension payments to retired employees. The retailer had initially asked the court for permission to immediately halt payments for pension, health and dental benefits for laid-off employees, retirees and surviving spouses due to a severe cash crunch, but later agreed to continue payments to retirees until Sept. 30.

Many former employees said the company’s compromise on temporarily paying retiree benefits and pension compensation has them cautiously hopeful.

Pina Rupa, 58, from Vaughan, Ont., said outside the courthouse that she hoped Sears Canada, where she worked for nearly 40 years, would reinstate her benefits and severance which she said were worth tens of thousands of dollars.

“I was such a loyal employee,” said Rupa, who was laid off from the company’s head office.

Employment lawyer Susan Ursel, whose firm represents more than 17,000 non-unionized former and current employees, said her law office is filing motions to ask the court to reinstate benefit, severance and pension payments to the workers who were laid off. It is also asking to set up a temporary hardship fund for those who are in dire need of cash and health benefits.

Ontario Premier Kathleen Wynne said her government is paying close attention to the situation but there isn’t a role it can play at this point.

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Linda Nguyen and David Paddon, The Canadian Press

by Canadian Press

Sears Canada gets court approval to begin soliciting bids for its sale

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