VANCOUVER (NEWS 1130) — The fallout continues for Mountain Equipment Co-op as a number of employees have received notices they have been let go and will not be receiving severance.
The letter from the Vancouver-based company says the employees will also no longer be receiving extended health benefits, RRSP benefits, or their staff discount.
Former co-op member Steven Jones says the sale agreement with Kingswood Capital Management, the Los Angeles-based investment firm that’s buying MEC, didn’t indicate a plan to keep all staff.
“The company that was acquiring the assets of Mountain Equipment Co-op was intending to keep at least 75 per cent of the active employees,” he says. “It kind of sets a maximum number, you know, it won’t be more than 25 per cent of the active employees.”
According to an email from MEC’s board of directors, it is keeping on more staff than it originally suggested.
“We are pleased that Kingswood Capital Management, LP has now confirmed that once the transaction closes, all but one of MEC’s current 22 stores will continue to operate, which is a positive development since the original announcement of a minimum of 17 stores. This also means 85 per cent of MEC’s active workforce will now continue as compared to the previously communicated minimum of 75 per cent.”
Thousands of MEC members rallied to stop the sale to the American company, but B.C. Supreme Court ruled the sale would go ahead last week.
The outdoor brand has floundered after months of controversy involving the elections of its board.
-With files from Ash Kelly