Wisconsin (WQOW) - The Wisconsin Department of Workforce Development (DWD) sent out an alert warning Wednesday, saying more than 1,000 Gordy's Market employees at 25 Gordy's sites may be out of work in the next 60 days.
In a letter sent to employees and the DWD, Gordy's Chippewa Foods, Inc. stated it is attempting to find "suitable buyers" to purchase the Gordy's Entities. It also stated:
"If we are unable to find suitable going concern buyers for any of the Gordy's Entities, or if the buyers of a Gordy's Entity do not hire substantially all of the employees of the Gordy's entity, a mass layoff or plant closing may follow..."
The letter stated that up to 1,008 employees could be affected by the layoffs, with a deadline to make new deals set for Oct. 28. The letter also stated:
"business circumstances may change, and that all employees may not be permanently laid off if the Gordy's Entities are purchased and remain operational".
Gordy's said healthcare benefit coverage for employees and their dependents may also be terminated after 60 days, beginning Aug. 29, 2017. In the letter to employees, the receiver wrote that they regretted the decision, but business and industry circumstances left no other options.
News 18 reported last week, Gordy's Market was served an $86-million lawsuit by of of their suppliers, Nash-Finch. In the lawsuit, Nash-Finch claimed that Gordy's Market was insolvent, or in imminent danger of becoming insolvent, meaning Gordy's owes more money than it is worth.
News 18 reported one week ago when Gordy's Market closed three of its "underperforming" stores in Stanley, Spencer and Richland Center. Previously, they also closed three other stores in northwestern Wisconsin, including Hayward, Chippewa Commons in Chippewa Falls and Eau Claire.
News 18 also reported Festival Foods signed a definitive agreement to purchase three Gordy's Market stores in Eau Claire and Tomah.
An executive with Festival Foods told News 18 on Wednesday that Gordy's being in receivership has muddled their plans to purchase the three locations, but the deal is still on.
Festival Foods said they were forced to cancel their hiring fairs because there is no longer a firm close date for their deal with Gordy's Market. Festival said those events will be rescheduled. They still hope to close the deal in mid-September. Festival Foods told News 18 in the past that they would like to hire 150 employees for their new stores.
This is a developing story. Stay with News 18 on-air and online for the latest details.