Legislation would end incentives for financial predators to deliberately bankrupt companies and protect worker pensions
NATIONWIDE — Ahead of the one-year anniversary of the introduction of the groundbreaking Stop Wall Street Looting Act Friday, retail workers with United for Respect, who are facing job loss, lack of severance, and no health benefits following private equity-fueled retail bankruptcies and layoffs amid this global pandemic, released the following statements:
“Wall Street executives don’t care about the damages they cause to working people like us, it has been a nightmare. Thomas H. Lee Partners LP, the private equity firm that drove Art Van into bankruptcy, left us jobless, with no severance or healthcare in the midst of the pandemic. After destroying our financial security, they offered us pennies in return. But without healthcare, my bills have skyrocketed and pennies will leave my family out in the cold. The days of Wall Street gutting companies to line their pockets must end. We need action from Congress to hold these private equity funds accountable for the lives they have destroyed along the way,” said Shirley Smith, a former Art Van employee of 23 years and United for Respect leader in Taylor, Michigan.
“People who have worked hard and played by the rules all their lives have been left with next to nothing, thanks to Wall-Street-induced bankruptcies. These private equity firms’ pursuit of profit has now become life-threatening as workers on the frontline continue to have basic safety precautions denied. Worker health and safety should not be something we need to fight for. While we fight for basic necessities, predatory Wall Street funds are continuing to destroy American jobs for profit. We need elected officials to stand with working people and support the Stop Wall Street Looting Act that will help restore balance to our economy and will stop private equity firms from using the coronavirus as an excuse to kick working people to the curb,” said Alex Ludwig, current PetSmart employee and United for Respect leader in San Antonio, Texas.
“For too long hard-working Americans like myself have been left behind and taken advantage of by corporations that only care about profits. Even during a global pandemic the abuses continue. From Toys ‘R’ Us, to Sears, and now PetSmart and Art Van, private equity has laid waste to thousands of retail workers and our families. Last year’s groundbreaking introduction of the Stop Wall Street Looting Act was a first step to putting power back into working peoples’ hands and holding private equity firms accountable. With the COVID-19 pandemic, this is about life and death. We need Congress to rein in private equity now and put a stop to Wall Street’s assault on working people and the American economy, destroying jobs and stranding hundreds of thousands of families,” said Ann Marie Smith, a former Toys ‘R’ Us employee and United for Respect leader in North Carolina who led the charge for severance pay.
Background on the Stop Wall Street Looting Act
The Stop Wall Street Looting Act (“SWSLA”) introduced last year by Sen. Elizabeth Warren would stop Wall Street firms from looting businesses and destroying jobs for profit, by being forced to share liability and put workers first in the event of bankruptcy through severance and pensions.
One year later, in the midst of a COVID-19 pandemic, private equity has fueled another round of retail bankruptcies and layoffs — including at Art Van retailers and PetSmart — often leaving newly unemployed workers and their families stripped of healthcare, and long-term financial security. And retail workers are demanding COVID-19 protections from the private equity firms at the root of the rot. To add further salt to injury, as people are losing jobs and health care, private equity-backed companies have received between $1.5 billion and $3.4 billion in Paycheck Protection Program loans.
From Toys ‘R’ Us, Sears, Kmart, Gymboree, to Payless, Wall Street firms are buying up large retailers, loading them with debt, and forcing them into bankruptcy while making millions in profit for executives. In just 10 years, a staggering nearly 600,000 people working in retail have lost their jobs at retail companies owned by private equity firms and hedge funds, according to a United for Respect report. Last year, Toys ‘R’ Us workers with United for Respect won a ‘mirror board’ and a $20 million hardship fund, spoke at the House Financial Services Committee, helped pass the first-ever law mandating severance pay in the country in the state of New Jersey, and stood with Sen. Warren to introduce the SWSLA.