#BoycottSearsCanada: Retailer faces 'PR nightmare' over treatment of laid-off workers
Chain tries to attract customers during restructuring, but encounters online criticism
Sears Canada is striving to reinvent itself and entice customers. But every time it posts an ad promoting products on its Facebook site, the retailer is bombarded with angry comments.
"No one cares!" wrote one person, commenting on a dishware ad. "As far as I'm concerned the whole company should go belly-up."
"Empty plates are what Sears ex-employees will be staring at after they have been rooked out of their severance and retirement payments," posted another person.
The spiteful comments follow Sears' announcement last month that as part of a court-supervised restructuring process, it's closing 59 of its 255 stores and laying off 2,900 workers — none of whom are getting severance.
Sears has also requested court permission to stop topping up the underfunded retiree pension plan. The retailer recently agreed to postpone that matter until Sept. 30.
The repercussions of the restructuring — especially the no-severance deal — have infuriated numerous Canadians, many of whom want Sears to know they won't be shopping at its department stores.
"I will not spend one red cent in your store … no severance, no sale," posted one person.
"I will not be checking out anything at Sears. Do your duty to your employees, you jerks," wrote someone else.
There are also calls for a boycott, with some adding to their comments: #BoycottSearsCanada. The hashtag has also shown up on Twitter.
If you want justice for the <a href="https://twitter.com/SearsCA">@SearsCA</a> employees being screwed over by <a href="https://twitter.com/SearsCA">@SearsCA</a> than <a href="https://twitter.com/hashtag/BoycottSearsCanada?src=hash">#BoycottSearsCanada</a> & their liquidation sale.—@johnjansik
Commenters have also griped about the news Sears will pay up to $7.6 million in court-approved retention bonuses to 43 executives and senior managers during the restructuring process.
"PLEASE SUPPORT THE C.E.O. OF SEARS CANADA HE NEEDS YOUR HELP!" someone posted as a joke on Sears' Facebook site.
"It's just a PR nightmare," says retail analyst, Bruce Winder about the social media attacks. "That is not going to serve them well as they try to build back sales momentum."
Winder believes Sears' restructuring has sparked a backlash because people don't like to see bad things happen to people they view as vulnerable — such as retail workers.
"Consumers, when they see that a company, in their opinion, doesn't treat those vulnerable people properly, they lash out," says Winder, with the Retail Advisors Network in Toronto.
Sears Canada told CBC News that deep financial troubles left it with no choice but to seek court protection from its creditors while it restructures.
As part of the court proceedings, the company said it's not able to make payments to a number of stakeholders, including laid-off workers owed severance.
It also said the employee retention bonuses are necessary to keep senior staff who will help Sears achieve the best possible outcome for everyone: a revamped retailer that stays in business.
Sears did not offer any specific comment on the reams of angry posts on its Facebook site.
Remember Target Canada
Many other cash-strapped companies have followed paths similar to Sears. For example, in 2015 Target Canada filed for creditors' court protection and announced it was closing all 133 stores and laying off 17,600 employees.
Those workers, too, didn't receive severance, although some continued to get paid while not working if their store closed early.
Key Target Canada staff also received retention bonuses to stay on the job during the wind-down process.
But the situation didn't appear to spark the same amount of vitriol as with Sears. One big difference is that unlike Target, which left Canada, Sears continues to run ads to drum up more sales and attract customers — at a time when the company has run out of money to pay severance.
"Hmmm how can you afford to advertise when you can't pay severance?" posted one person following a Sears Facebook ad for a dress.
"The advertising budget doesn't end, kind of like the Executive's pay," stated another comment on an ad for a suitcase.
"The fact that they're still advertising and still staying open, is really seen as a bad idea for many people," says June Cotte, a marketing professor at the Ivey Business School at Western University. She adds that the retailer must keep promoting its products if it wants to survive.
Cotte says another problem Sears faces is that, unlike Target, many Canadians grew up with the iconic department store chain and feel a connection to the retailer.
"That relationship or that memory seems now tainted," she says.
Tracy Brown in Stratford, Ont., informed Sears on Facebook she'll no longer shop at the retailer. A customer since childhood, Brown told CBC News she feels sorry for the laid-off workers.
"Some of these people, their whole career has been with Sears."
Carrie Brasier in Winnipeg also told Sears on Facebook she's boycotting its stores because of what's happening to laid-off staff.
"As a blue collar worker, it just kind of tugs at you, it makes you mad," says the maintenance planner.
Brasier also grew up with Sears but feels just as much anger towards Target Canada for not paying its workers severance.
But she says the difference is that Target is simply no longer a target in Canada.
"I can't boycott them because they went bankrupt and ran back to the U.S."