Durham Furniture slashing jobs; 150 being laid off, Chesley plant closing
Posted By JONATHON JACKSON
Posted 2 days ago
Durham Furniture will end production in Chesley by mid-March and 150 jobs will be lost after the company sought protection from its creditors and launched a court-supervised restructuring of its finances and operations.
All further production will be consolidated in the Durham factory, according to a news release from the insolvent company, which received creditor protection Tuesday under the Companies' Creditors Arrangement Act.
"This is really bad news," said Arran-Elderslie Mayor Ron Oswald, whose municipality includes Chesley. "They were the biggest employer we have in Arran-Elderslie and in Chesley. It's going to be a great loss to the municipality and the community."
Kevin Eccles, mayor of West Grey, which includes Durham, said the news will be "a devastating blow" to the local economy.
Under CCAA rules, a company must have more than $5 million in liabilities before it can receive protection under the act. The news release from Durham Furniture said the strong Canadian dollar and an "underutilization of our manufacturing capacity" are to blame for the conditions which led the company to seek that protection.
"This difficult decision is the best course of action given the current economic conditions and challenges," Michael Pitman, the company's chief executive officer, said in the release.
Also cited was a "weak" economy in the United States, where Durham Furniture has a showroom and ships the majority of its products. The showroom, in High Point, N.C., will also be closed.
"While these decisions affect many valued employees, we believe the necessary structural changes will benefit the company for the long term," chief operating officer Wayne Brohman said in the release.
Brohman would not comment when contacted by The Sun Times.
The company's executive secretary, Wendy Zettler, who issued the release, clarified the pending closure of the Chesley plant but said she could not comment further.
Durham Furniture employed 650 people in November 2006 when it was producing an estimated 170,000 to 180,000 pieces of solid wood bedroom furniture annually.
Two separate layoffs in 2007 resulted in the loss of 140 jobs and the shift of some work, like cabinet finishing and final trim and packaging, from Chesley to Durham.
People who kept their jobs took pay cuts of five per cent and the company said then it would be able to "focus on its long-term strategies and preserve employment for its valued workforce."
An anonymous caller to The Sun Times said a further five per cent pay cut was coming on Jan. 28.
Oswald, who was not aware of the company's latest decision until he was told by a Sun Times reporter, said he had not been optimistic about Durham Furniture's future in spite of that reassurance.
"I have had serious concerns of this for a few months," he said.
Eccles added his understanding was the company has found it difficult to compete with products made at much lower prices by overseas manufacturers, particularly those in China.
It's not clear yet whether the job losses will come only in Chesley or whether they will also affect employees in Durham.
Eccles wouldn't find it any consolation if it turns out only Chesley employees will lose their jobs.
"It's still devastating. I can't say that this protects or insulates anything in West Grey or Durham," said Eccles, who is also the warden of Grey County. "And there's a number of people from Southgate and Grey Highlands and Hanover that work at Durham Furniture."
Oswald is trying to remain optimistic, pointing out the Chesley facilities are still fairly new and might prove attractive to another company that wants to set up shop there.
"Maybe something good will come out of this. They mightn't be making furniture there again, but I'm sure there's other uses for the facilities," he said.
"We have a council meeting all day Monday, so this'll be on the agenda."
Find thousands of Bilingual jobs at LatPro.com.
Posted 2 days ago
Durham Furniture will end production in Chesley by mid-March and 150 jobs will be lost after the company sought protection from its creditors and launched a court-supervised restructuring of its finances and operations.
All further production will be consolidated in the Durham factory, according to a news release from the insolvent company, which received creditor protection Tuesday under the Companies' Creditors Arrangement Act.
"This is really bad news," said Arran-Elderslie Mayor Ron Oswald, whose municipality includes Chesley. "They were the biggest employer we have in Arran-Elderslie and in Chesley. It's going to be a great loss to the municipality and the community."
Kevin Eccles, mayor of West Grey, which includes Durham, said the news will be "a devastating blow" to the local economy.
Under CCAA rules, a company must have more than $5 million in liabilities before it can receive protection under the act. The news release from Durham Furniture said the strong Canadian dollar and an "underutilization of our manufacturing capacity" are to blame for the conditions which led the company to seek that protection.
"This difficult decision is the best course of action given the current economic conditions and challenges," Michael Pitman, the company's chief executive officer, said in the release.
Also cited was a "weak" economy in the United States, where Durham Furniture has a showroom and ships the majority of its products. The showroom, in High Point, N.C., will also be closed.
"While these decisions affect many valued employees, we believe the necessary structural changes will benefit the company for the long term," chief operating officer Wayne Brohman said in the release.
Brohman would not comment when contacted by The Sun Times.
The company's executive secretary, Wendy Zettler, who issued the release, clarified the pending closure of the Chesley plant but said she could not comment further.
Durham Furniture employed 650 people in November 2006 when it was producing an estimated 170,000 to 180,000 pieces of solid wood bedroom furniture annually.
Two separate layoffs in 2007 resulted in the loss of 140 jobs and the shift of some work, like cabinet finishing and final trim and packaging, from Chesley to Durham.
People who kept their jobs took pay cuts of five per cent and the company said then it would be able to "focus on its long-term strategies and preserve employment for its valued workforce."
An anonymous caller to The Sun Times said a further five per cent pay cut was coming on Jan. 28.
Oswald, who was not aware of the company's latest decision until he was told by a Sun Times reporter, said he had not been optimistic about Durham Furniture's future in spite of that reassurance.
"I have had serious concerns of this for a few months," he said.
Eccles added his understanding was the company has found it difficult to compete with products made at much lower prices by overseas manufacturers, particularly those in China.
It's not clear yet whether the job losses will come only in Chesley or whether they will also affect employees in Durham.
Eccles wouldn't find it any consolation if it turns out only Chesley employees will lose their jobs.
"It's still devastating. I can't say that this protects or insulates anything in West Grey or Durham," said Eccles, who is also the warden of Grey County. "And there's a number of people from Southgate and Grey Highlands and Hanover that work at Durham Furniture."
Oswald is trying to remain optimistic, pointing out the Chesley facilities are still fairly new and might prove attractive to another company that wants to set up shop there.
"Maybe something good will come out of this. They mightn't be making furniture there again, but I'm sure there's other uses for the facilities," he said.
"We have a council meeting all day Monday, so this'll be on the agenda."
Find thousands of Bilingual jobs at LatPro.com.
Labels: Canada, Durham Furniture, layoffs, Ontario
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