Sears Canada’s employees want court to protect their health benefits

By The Canadian Press

Lawyers for Sears Canada employees are asking an Ontario judge to have the struggling retailer reinstate or continue their health benefits until October as the company restructures under court protection from creditors.

The request is one of several motions to be heard Thursday by Justice Glenn Hainey at the Ontario Superior Court, which granted Sears Canada temporary protection from creditors three weeks ago.

The employees’ lawyers argue that their clients and retirees are the “most vulnerable” groups affected by the company’s financial difficulties and its plan to close dozens of stores.

They also argue that the company is proposing excessive payments for about 43 head office employees who are being kept on.

The motion says $7.6 million in discretionary retention payments for key employees should have a lower priority than the claims by employees who have been laid off or given notice that they will lose their jobs without severance in the coming months.

About 400 employees from the Toronto head office were immediately let go on June 22 without notice and salary payments were immediately cut off for 1,000 employees who had received termination notices prior to June 22.


Related stories:

Former Sears employee calls losing severance ‘a slap in the face’

Sears Canada to seek court approval to suspend benefits for retirees

Sears Canada to cut 2,900 jobs, secures creditor protection


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