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Saks distribution in Aberdeen's future in limbo with new owner, layoffs

Mergers, Acquisitions and TakeoversUnemployment and LayoffsJob LayoffsRestructuring and Recapitalization

Plans to lay off 191 employees from the Saks Incorporated Distribution Facility in Aberdeen, announced earlier this month, will end up affecting about 70 percent of the facility's workforce and are raising questions among workers if the facility is heading for a full shutdown.

But Saks' new owner says the Aberdeen apparel and accessories distribution operation will not necessarily close completely, despite the size of the announced layoff and previous job cuts at the facility last year.

On Dec. 4, Saks Fifth Avenue sent a letter to its Aberdeen employees announcing that positions will be eliminated because of a merger with the Hudson's Bay Company. The merger had been announced a month earlier, on Nov. 4.

Hudson's Bay Company and Saks will merge some distribution functions into the Hudson's Bay Company, Wilkes-Barre, Pa. location, which will affect the Aberdeen facility.

"These decisions are never easy. While it was a difficult decision to make, reorganization is an integral part of merging companies," Dan Dasinger, senior vice president of logistics for Saks, wrote in a letter to employees, a copy of which was obtained by The Aegis. "This decision is certainly not a reflection of your contribution to Saks Fifth Avenue."

It is unclear if other positions in the Saks company will be impacted by the merger, according to a statement released by Hudson's Bay Company on Monday.

The statement said Saks "Hickory Ridge Distribution Center will remain open and continue to support the businesses."

According to "Notice of Facility Closing" the company is required to file and post by law, 14 management employees and 177 hourly support staff will be laid off from the distribution center. Various departments like shipping and receiving, return to vendor, logistics, transportation, hold and flow, vendor quality management audit, cafeteria, engineering, maintenance and internal services department will be affected by the layoffs.

"The integration will allow the company to leverage synergies by combining the receiving and processing of merchandise into one facility, ultimately enhancing customer service by getting product to stores faster," according to the statement from Hudson's Bay Company.

The layoffs will begin Jan. 3 and continue through July 30, 2014.

During the first round of layoffs in January, 132 employees will be let go from the facility, according to the notice.

"The company is doing everything it can to assist impacted employees during this transition, which includes appropriate severance packages for eligible associates and partnering with the Maryland Workforce to assist with placement," the Hudson's Bay Company statement said.

The new owner also said the current merger related layoff is unrelated to the previous layoffs last year.

In May 2012, Saks had announced it would lay off 223 employees of the more than 600 people working at the distribution center at the time.

In 1997, the Saks Distribution Center moved from Yonkers, N.Y., to the Hickory Ridge Business Park in Aberdeen, occupying a new 584,000-square-foot facility. At the time, the Hickory Ridge Center became the primary hub for clothing and accessories distributed to the company's 100 stores nationwide and its mail order business.

Copyright © 2014, The Baltimore Sun
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