Closure catches Terra Nova Shoes workers off-guard
Workers at the Terra Nova Shoes factory in Harbour Grace were blindsided Tuesday morning when they reported for their regularly scheduled shifts.
As the group piled into the footwear production facility, the employees had no idea they were about to be told the plant was closing later this year.
TC Media has learned three executives from Kodiak Group Holdings, the owner of Terra Nova Shoes, were on hand to announce to about 80 workers the facility on Water Street will cease operations this November.
After receiving the news, workers were sent home for the day. They will return to work today.
Workers said no advanced notice was given, and some have referred to the news as “devastating.”
Terra boots began production in 1971 in Harbour Grace, and has since become a well-known brand. But after November, all production will be moved to Cambridge, Ont.
A news release was received late Tuesday morning with a statement from Kodiak. It confirmed each employee will receive a severance package — the details of which have not been made public — and those who decide to stay on until November will also receive bonuses.
TC Media has also learned some supervisory workers will continue their employment at the facility in Cambridge.
Others will have the opportunity to work in Cambridge as well, but they will have to apply. Those who are chosen will receive relocation assistance.
Kodiak president Kevin Huckle said cost is the primary reason for shutting down, but the company will stay in Canada.
“We are committed to manufacturing in Canada,” Huckle said. “The reality is the high costs to continue operating the Harbour Grace plant have become unsustainable over the past several years.”
The company has received numerous loans and grants over the past decade, but even with the extra funding, the workforce has decreased by half.
An interest-free loan of $8 million was given to the company in 2008 by the provincial government.
In 2010, 59 workers were laid off. More workers lost their positions in a second round of layoffs.
The company was supposed to start supplying boots to the Canadian Forces this year, but all production will take place in Cambridge after November.
Not long after the announcement was made, several Harbour Grace councillors headed to the town hall to discuss what the closure means for the town of about 3,200 people.
Mayor Terry Barnes, Deputy Mayor Sonia Williams, Coun. Pat Haire and Coun. Kathy Tetford spoke with TC Media.
“It’s very disappointing that expansion in 2008 led to layoffs in the past six years, and now total closure,” Williams said. “It’s devastating.”
Haire would like to see the town bounce back from the loss as fast as possible because of the loss of taxes from the company, which is about $70,000 annually.
“It’s a sad day for the town, and the surrounding area,” he said.
“A lot of people are out of work. It’s too bad they couldn’t make it work, but we will do whatever we can to (speed up) the situation.”
Barnes said he heard the news Monday after being contacted by a reporter from St. John’s, and felt he needed to investigate.
Barnes and Carbonear-Harbour Grace MHA Sam Slade went to the facility Monday, but could not confirm the information. They left under the assumption that it was “business as usual.”
Barnes said the shutdown is devastating to the people of the region who work at the company.
He’s disappointed the council was not informed that the doors would be shutting to Terra Nova Shoes, and felt it should have been told prior to being released to the public.
“Council will have to get together, and see what steps we can take from here,” he said. “Do we want to lose jobs? Absolutely not.”
Tetford said she wants to ensure workers involved in the closure are not left out in the cold.
“The town is taking necessary steps to protect the assets, and make sure the residents of Harbour Grace and surrounding areas are treated in the best way possible,” she said.
Slade was not available for comment.