September 28, 2020
Dear Mr. DiNovi and Mr. Sperling,
We write to you as former Art Van Furniture employees, both eligible and excluded from the newly announced Art Van employee hardship fund. We are writing to inform you that while the creation of a hardship fund is an important step, the one-time payment of $400 to former Art Van employees is woefully inadequate and fails to address the hardship that thousands of former employees are facing.
We are calling on Thomas H. Lee Partners again to ensure that all former Art Van employees receive at least $1,500 each. This is a conservative estimate of the cost of three months of health coverage for a family. As we shared with you during our conversations this spring, former employees are facing astronomical hospital bills, unable to afford prescriptions, surviving a pandemic as immune-compromised, and recovering from contracting COVID, among many other circumstances. This fund, at the current funding level, does little to support employees.
The announcement of the fund comes nearly six months since Art Van filed for Chapter 11 bankruptcy and five months since Thomas H. Lee executives committed to establishing such a fund. Meanwhile, thousands of Art Van employees were thrown out of work, losing our jobs, income, health coverage, and earned vacation pay, all at the start of a pandemic and recession. Several of us also had our health insurance cut prior to stores closing, although we were still paying into our insurance and working at Art Van.
Additionally, some employees learned that the funds we contributed to our personal Flexible Health Savings Accounts (FSA) were eliminated when Art Van went bankrupt. In the case of employees like Laura Virgo, her forfeited account balance of $525 exceeds the $400 she can expect from the fund, if her application is approved. We are also writing to ask you to ensure that all former Art Van employees receive their unused FSA balances.
The fund also arbitrarily caps eligibility to those earning under $99,000/year, which excludes some of Art Van’s top salespeople who faced incredible hardship during the pandemic, including a top saleswoman for several years who was renowned in the company, and who contracted COVID soon after stores closed. We believe that a cap should be set by titles and not salary, to make the fund inclusive.
We have been calling on Thomas H. Lee to provide meaningful support to former employees, and to at least meet the precedent set by Robert Levin, who created a $1500 per employee fund even though he was not responsible for Art Van’s demise. Your responsibility is clear. When your firm acquired Art Van in 2017, it was a successful family-owned company with 117 stores and 3,500 employees. In three short years, Thomas H. Lee drove a healthy, 60-year old company into bankruptcy. You previously boasted that your executives invested $335 million of your own capital in Thomas H. Lee’s newest funds. You can, and must, do better.
Thomas H. Lee destroyed our beloved company and left thousands of us without jobs, following a familiar pattern of private equity wealth extraction that left us with nothing. We are calling on you again to contribute at least $1500 for each former employee, including eliminating arbitrary caps to eligibility. Doing so will help us get back on our feet and care for our families.
Art Van Committee
Sterling Heights, MI
Lansing , MI
Charter Township of Clinton, MI
Swartz Creek, MI