Call centre closure leaves hundreds jobless
SYDNEY, N.S. — Politicians offered a glimmer of hope Friday to hundreds of Cape Breton call centre workers grappling with layoffs less than three weeks before Christmas, saying the operation has a “bright future” and could be up and running again soon.
ServiCom Canada announced the closure of its Sydney operation Thursday, handing pink slips to almost 700 workers in a region already struggling with a stubbornly high unemployment rate.
The shutdown followed a bankruptcy protection filing by ServiCom’s U.S. parent, weeks of pay delays and promises of bonuses and pay incentives for workers who stayed.
In the aftermath of the layoffs, many workers spent Friday filing employment insurance claims and seeking help from local charities.
“I am devastated, to say the very least. It was definitely not what I expected,” 26-year-old Kayla Williams, who worked at the office for five years, said from her home in Sydney.
“I want to be able to put (heating) oil in my tank. I want to be able to put groceries in my cupboard. I have two children here.”
Nova Scotia Business Minister Geoff MacLellan said it was a “devastating time for Cape Bretoners.”
However, the Cape Breton politician also said he was confident the centre had a “bright future” after speaking with a prospective buyer Friday morning.
“There is a potential buyer that is very interested and will do whatever they can to make sure this centre is part of their complement in the very near future,” MacLellan said, adding that the potential buyer was looking forward to “opening it early in the new year.”
The minister said he couldn’t offer more details, citing court proceedings in the United States. He said a deal was pending when the bankruptcy issues caused a snafu.
“We’re working with that entity along with the federal government to make sure we do what we can to re-engage this call centre as soon as possible,” he said.
Cecil Clarke, mayor of the Cape Breton Regional Municipality, said the closure “came as a shock,” despite the company’s ongoing financial troubles.
“It’s never good to lose your job, but during the winter and Christmas season, it’s devastating,” he said.
Still, Clarke said company representatives have indicated to him they intend “to have this situation resolved in the next couple of days.”
He said even though the call centre’s U.S. parent is in financial trouble, the centre itself was turning a profit.
Meanwhile, Clarke said the immediate focus is on providing temporary transition assistance to workers.
The Sydney operation first opened under different ownership nearly two decades ago during a wave of call centre openings across the Maritimes.
Businesses were attracted by the region’s lower payroll costs and often received government incentives.
A Nova Scotia Business Inc. media release from March 2009 said the Crown-owned business agency provided ServiCom, a subsidiary of JNET Communications LLC, with a payroll rebate worth up to $914,400 over five years.
Since 2010, ServiCom has received $638,360 in loans from the federal Atlantic Canada Opportunities Agency and Enterprise Cape Breton Corporation, part of ACOA since 2014.