After Promotions Unlimited abruptly closed its doors on Friday, the president of the company Lorraine Greenberg notified its employees via a letter sent Wednesday that the closure is permanent and its paycheck vendor is reversing the employees’ direct deposits.
Mount Pleasant-based Roosevelt Capital LLC owns Promotions Unlimited, which supplies retail stores with dollar store items and promotional materials.
A number of employees paychecks, which had been deposited Friday, saw their money taken out of their bank accounts on Thursday. Other employees, who bank at Educator’s Credit Union, were told the bank would refuse the reversal and work with the employees, according to several employees.
“This money is coming out after it was direct depositing on Friday,” said Michelle Humburg, who worked at Promotions Unlimited for 14 years. “Those who don’t bank with Educator’s are seeing their money disappear from their accounts.”
Humburg, who banks at Educator’s, said her account was not affected. But many other employees money disappeared. Racine County Eye spoke with one employee who was at her bank Thursday morning to sort out the problem.
Racine County Eye obtained the letter Greenberg wrote, which informed the employees on Wednesday that the closure was “due to a sudden and unexpected refusal by the Company’s lender, Franklin Capital to provide the Company with access to necessary financing to continue operations.”
The letter also informed employees that the vendor Promotions Unlimited used for its payroll, Paylocity, told the company that it would be reversing the direct deposit the employees received. Racine County Eye reached out to Greenberg at Promotions Unlimited, but did not receive a return phone call.
“The company truly regrets that these actions are necessary and taking place on such a short notice,” Greenberg wrote in the letter. “Prior to January 26, 2017, the company had no notice that Franklin Capital would refuse to provide the necessary financing it had previously provided. In short, the circumstances prompting these actions were sudden, unexpected, profound and beyond the company’s control.
“We deeply appreciate the loyalty of our employees and our foremost concern is to help our workers find other employment.”
All 77 positions were eliminated and no severance pay was offered. Greenberg stated in the letter that while the layoffs are expected to be permanent, there may be a potential that Franklin Capital may call some employees to help liquidate the company. An email and phone call were also placed to Franklin Capital, but Racine County Eye has not received a response.
On Friday, there was no indication that the closure was permanent, Humburg said.
“This is just so sad,” Humburg said. “A number of these people live paycheck to paycheck.”