ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Saturday, December 21, 1996 TAG: 9612230036
SECTION: VIRGINIA PAGE: A-1 EDITION: METRO
SOURCE: MEGAN SCHNABEL STAFF WRITER
Hanover Direct Inc., the catalog retailer that moved into Roanoke three years ago with a promise of hundreds of jobs, on Friday said it will lay off its apparel division telemarketers and the second shift at the distribution center. The moves leave a yet-unknown number of people without work.
The Weehawken, N.J.-based company will begin layoffs at the apparel division, located in the former Tweeds catalog center at Bonsack, between Feb. 18 and March 1, according to a notice distributed Friday to employees. Orders formerly handled in Roanoke will be routed to the company's Hanover, Pa., telemarketing facility.
The Roanoke-area cuts are part of Hanover Direct's companywide attempt to trim costs by $50 million. The company lost $30 million in 1995 and another $52 million during the first nine months of 1996, said Larry Svoboda, Hanover Direct's senior vice president and chief financial officer. The mail order company expects its revenues to decline by 14 percent next year, after discontinuing several catalogs during 1996. Hanover Direct currently sells from 12 catalogs, he said.
"I would not call that a robust situation," he said.
Those losses had been reflected at the Roanoke facilities.
"They've called us every day this week, saying we didn't need to come in because there was no work for us to do," said Nickie Miller, who has been a telemarketer for a year and heard about the layoffs Friday, when she came in to pick up her paycheck.
Employees who were working Friday were called into a break room and given the news five at a time, said an apparel division telemarketer. She did not want to be identified because she planned to continue to work at Hanover as long as possible. Workers were allowed to go home early Friday if they were upset, she said.
"We knew the company was losing business," she said. Employees' Christmas bonuses had been radically trimmed this year, she said. But she didn't think the result would be this drastic.
"I'm 18 years old, and nobody else is going to start me making $6.50 an hour," said Tamara Agee, another apparel division employee.
"If they had a heart, they could've at least waited until next week," said a former worker in the receiving and shipping department at the distribution center on Old Hollins Road. He did not want to give his name because he didn't want to hurt his chances for getting another job with Hanover Direct. "Merry Christmas, huh?"
There was still confusion late Friday over the exact number of layoffs. According to a company press release, 550 workers were laid off companywide, including positions in Pennsylvania. Svoboda said he did not know how many job cuts would take place at the two Roanoke facilities.
As of April, Hanover Direct had employed close to 1,000 people at those facilities.
Roanoke County Administrator Elmer Hodge said he had been told 110 jobs were affected in Roanoke, with more being eliminated in Pennsylvania.
Hanover Direct had notified the Virginia Employment Commission that a 100-person layoff would be announced Friday, said Rob Ashby, manager of VEC's economic dislocation worker adjustment assistance unit. The company authorized the VEC to offer services to those who are laid off, he said. Those services can include job counseling and training, but specifics of the Hanover agreement were not available.
The company told the VEC it would lay off "order fillers," Ashby said.
But former employees of the two facilities believe that more than 100 people are losing their jobs. Estimates ranged from 200 to more than 400 cuts.
"We're disappointed to see this happen," Hodge said. "We're really saddened to see this happen. ... It is always unfortunate when it happens at Christmas."
He did not criticize the company for its actions, saying, "You have to look at the profitability and the ability of an operation to stay in business."
Hodge said he's hopeful that the Roanoke Valley's low employment rate will help laid off workers find new jobs quickly. The region's jobless rate was 2.8 percent in October, the latest available figure.
He said Hanover Direct apparently has met its obligations under an agreement which provided the company with $2.1 million in incentives through the county and state. Hodge said county calculations indicate the company is in compliance as long as it keeps 350 jobs in the Roanoke Valley, and that agreement expires at the end of this year.
Svoboda said the company met with county officials Friday to determine the status of the agreement. He did not know the outcome of the meeting.
The incentive package included $900,000 to widen Hollins Road to three lanes in front of Hanover Direct. Hodge said that project would not be affected by the layoffs. He said the road project would benefit other companies in the area, including Ingersoll-Rand Co. and AMP Inc.
Hanover Direct also announced Friday that it would no longer be filling orders for several Sears, Roebuck & Co. catalogs.
Staff writers Sandra Brown Kelly, Christina Nuckols and Jeff Sturgeon contributed to this report.
LENGTH: Medium: 95 lines ILLUSTRATION: PHOTO: Cindy Pinkston. Hanover Direct Inc. has a women'sby CNBapparel division at 1 Avery Row off 460 in Ronaoke County. 2.
(headshot) Agee. KEYWORDS: JOBCHEK