Thread regarding Sears layoffs

If SHC goes into bankruptcy would we lose our jobs straight away or would there be a month or two or three's worth of warning?

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Your 401k is completely safe, as long as none of it is invested in sesrs stock. Your pension is underfunded. It will pay out at full value as long as the company runs it. If the company fails, and it is turned over to the PGBC, then it may be paid at a lower rate (depending on whether you exceed the maximum benefit (see 2016 PGBC payable benefit for that). Otherwise, you should be safe, I think. Medical insurance for retirees will probably be zilch. And other retiree benefits will probably also be nothing.

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I have been with Sears for 18 years, and I have the pensions, not much, and a 401(k). Will I be safe, if Sears declares BK in 2017, I will turn 55 in June, should I get out the last month of June to get my pension, and 401(k). Please give me your advice. Thank You, A faithful Sears Employess.

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It's a numbers game then. If corporate could buy out the leases and contracts, and have money left over after the sale of all assets, then they would pull the plug tomorrow. As it is, they have to weigh the continuing daily loss from operating, with how much they will have to pay to shut it all down. I doubt they will be able to make their money last anywhere near 5 years. So there will probably be a plan in place to minimize the losses from buying out the contracts and leases.

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SHLD Liquidity was just down graded to SGL-3

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To be honest in bankruptcy severance pay does not exist at all. Unless I am wrong?

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Most stores have less than five years left on their lease.

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No, your 401k is locked away from sears, as part of the employee retirement income security act of 1974. If, however, you have any portion of it tied up in sears stock, then that will be wiped out. As has been recently reported in the news, the stock fund is closing to new investment, but that's not going to affect you if you don't own any of it. But if you do, sell, sell, sell.

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they are laying off now but not making it public. you usually get one day notice or same day notice. you don't know what the day holds when you show up in the morning. they provide you with a recall date but have no intention of honoring it. if your older and make a decent wage, your ticket is coming up soon.

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If they do bankruptcy, will employees lose they 401K and will they get a severance pay?

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Actually, it's yes and no. If the company declares bankruptcy, then management loses control of operations to the legal syste. Management can then come up with a plan to bring a company out of bankruptcy by making deals with debtors (bond owners, vendors), and terminating contracts (again with legal help). And stopping money-losing operations.

Usually, that means a massive closure of stores.

If management can't prove to a judge that they have a realistic plan to make the company solvent again, then they will liquidate. Now given the shear size of Sears, that means they have to sell a huge amount of inventory (but they will do so at fire-sale prices). Maybe they will sell to other companies, similar to what Sears is doing selling Brinkman grills (they went out of business, and sears bought the remaining stock for pennies on the dollar).

Sears does have a lot of assets (brands, stores both crappy and nice), as well as Home Services, and delivery. So they could weather a bankruptcy and potentially come up with a plan to stay in business for a few years. But there will be a lot of pain felt by a lot of people.

But I think the bigger likelihood is that Sears won't go bankrupt, but Eddie will just give up, close down operations, liquidate, and sell off all of thr remaining assets. As long as he honors leases (or buys them out), and pays vendors what they are owed, then he can do whatever he wants as both president and majority shareholder. That's what I think will happen. Close stores as they come off lease, liquidate as much inventory as possible, and do an orderly wind down of operations. I am not cognizent of when the majority of leases end, but will define the timeline.

That, my friends, is all that Eddie ever intended to do. Sears was an asset rich entity that he grabbed cheap, and he is just stripping it down to sell off the pieces. People don't matter to psychopaths like Eddie. He is only interested in enriching himself.

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A layoff is different than a bankruptcy. If it is Chapter 7 they just lock the doors. If you expect notice pay they will close down sooner to have the cash to pay yo for 2 months.

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Don't forget about Service Merchandise. They filed Bankruptcy in 1999 and closed their remaining stores in 2002.

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Many don't go bankrupt right before Christmas, but some have. Circuit City comes to mind. When the bottom falls out, it falls out.

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No retailer goes bankrupt before the holiday season with all of the volume that that entails. I'm sure some vendors haven't shipped product to sears, but bet most have so they would much rather sell it and get that cash than declare BK prior. Then it all depends on how much cash is left after what is certain to be another pitiful 4th quarter. Eddie will go down with the ship, but at some point Bruce has to do right by his shareholders, and the pressure will be immense if SHLD has another truly wretched holiday quarter. We know how this story ends, just don't know when....

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It appears they are set up to get through the year. And another sale to Seritage is possible. As some of the SHC fans frequently point out on the financial boards, there have been predictions of bankruptcy going back at least a decade and it hasn't happened yet. But employees should be careful not to get too complacent. About the only thing near certain here is the eventual failure of SHC retail. How it will play out is hard to predict. Even with all the warning signs, it will still seem a surprise when it finally happens.

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I think there is time left- the next move which would move them a step closer to bankruptcy is if they spin off more stores to the rest seritage - that's the final lot of things to burn before they freeze to death.

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I wouldn't count on much warning. There are numerous exceptions to the Worker Adjustment and Retraining Act which would allow SHC to avoid the 60 days notice. For one thing most of the SHC stores probably don't have more than 100 employees. Faltering companies are also exempted. Employees with less than 6 months tenure and/or who work less than 20 hours a week don't count.

Employees should be planning for store closure at any time. Failing companies will pretend it's business as usual right up to the end, to prevent problems such as employee theft. This company is running out of money and options. I've been observing the slow deterioration of Sears for going on 40 years and it's just about done.

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Thanks for the replies, I have a family and don't want to be left with no job right away, it's comforting to know I might get some time to find another should bankruptcy/job losses come up

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It's ok, I was just using ITT as an example did not mean to confuse anyone.

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Sorry, searched and then understood. Thanks much for explaining. I do see it now.

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I do read the news and did not see the latest death notice for SHC. where was it to be found?

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That is correct, an example is that ITT tech did not give a WARN notice to their 8,000+- employees and the employees are suing their former employer for no notice. If anyone has read the news lately, they know what I am referring to.

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"If your workplace has 100 or more employees, the Worker Adjustment and Retraining Notification Act requires employer notification of a mass layoff 60 calendar days in advance."

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