2,400 Employees in California and Nevada Affected : HRT to Close Its 32 Zodys Outlets
Unions representing about 2,400 employees of Zodys discount department stores were notified Thursday by HRT Industries, the chain’s parent, that it intends to close its 32 outlets in California and Nevada.
In addition, Three D Departments, an East Hartford, Conn., company that leases and operates linen and domestics departments in Zodys stores, said it had received written notice that the closures would begin on March 3 but that some outlets will continue to sell merchandise at reduced prices through the end of the year.
Despite these notices, officials at HRT Industries’ office in West Los Angeles remained silent on the situation. Chief Executive Steven J. Green relayed a “no comment” through his secretary, who added that the company intends to issue a press release at the end of the month.
Richard Rothstein, manager of the California joint board of the Amalgamated Clothing and Textile Workers Union, said HRT did not specify a date for the closings. The union represents about 2,000 salespeople, cashiers and other store employees.
Some Unhappy People
“We’ve notified all our stewards and I’m sure they’re telling (the employees) by word of mouth,” Rothstein said. “We have a lot of very unhappy people--no question about it.”
Cornelius Wall, regional director for the International Ladies Garment Workers Union, which represents about 400 HRT employees, said his union was notified of the closings by telephone and was told that HRT would begin severance payments to some employees as early as next week. The union represents workers at HRT’s West Los Angeles headquarters and its Rancho Cucamonga warehouse, where many workers have been laid off during the last month, Wall said.
Under their current contracts, workers are eligible to receive one week’s severance pay for every two years of employment, with a maximum of seven weeks’ pay. Rothstein said the textile workers’ contract also provides for continued medical and dental coverage for several months after the closings.
A Zodys employee who answered the phone at the Lynwood location said she had been told that the store would close in mid-April. “We were all expecting it,” she said. “Rumors have been around for about six months.”
An employee of the store at Fairfax and Slauson said that store is expected to close March 7. “People are disgusted, disappointed and mad,” she said. “I’m kind of upset because they didn’t come out and tell us until this morning.”
Bernard Abrams, chairman of Three D Departments, said his company’s attorneys have been instructed to file suit next week against HRT, alleging breach of contract, in an effort to recover for damages that he said will be caused by HRT’s early termination of the company’s license agreement, which expires next Jan. 31.
He also said that, under terms of that agreement, any company that buys or subleases more than 25% of the Zodys stores would be required to offer to enter into an agreement with Three D to operate a linen and domestics department.
Sources familiar with HRT have said that Ralphs Grocery Co. has agreements to lease 15 Zodys properties. Those are in Redondo Beach, Long Beach (two stores), Canoga Park, West Covina, Anaheim (two stores), Santa Ana, Norwalk, Inglewood, Lynwood, Pomona, Torrance, Boyle Heights and Hollywood.
HomeClub, a Fullerton-based chain of discount home-improvement stores, reportedly has agreements on five more Zodys stores--in Burbank, North Hollywood, Riverside, City of Industry and at Fairfax and Slauson in Los Angeles.
