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Golden Guernsey still owes workers $1.6 million year after closing

Waukesha plant shut down Jan. 5, 2013, ending 83-year legacy

The Golden Guernsey plant in Waukesha is seen in August 2012, months before shutting down.
The Golden Guernsey plant in Waukesha is seen in August 2012, months before shutting down. Credit: Milwaukee Journal Sentinel files
Jan. 05, 2014

By Rick Barrett of the Journal Sentinel

Jan. 05, 2014 0

Golden Guernsey Dairy employees are still owed $1.6 million in pay and benefits, state officials say, a year after the milk bottling company closed suddenly and left more than 100 people out of work.

The Waukesha plant shut down Jan. 5, 2013, ending an 83-year legacy in the Milwaukee area and disrupting the lives of employees, including some who had worked there for nearly 40 years.

Some of the employees are owed more than $25,000, state records show, including vacation pay, a pension match and other compensation.

Not everyone has found jobs equal to what they had a year ago.

"I know of some people who are making half of what they made. It's been tough, especially if they have a family to support," said Barry Towe, who worked nearly 36 years at the plant.

Days after the closure, Golden Guernsey filed for Chapter 7 bankruptcy protection in U.S. Bankruptcy Court in Delaware. A trustee was appointed to sell the company's assets, and the sale proceeds were designated to pay off creditors.

Workers were paid their final wages, but their other claims remain in limbo.

The employees could be eligible for an additional two months of pay because Golden Guernsey's owners, California-based Open Gate Capital, didn't file a 60-day plant closing notice as required by state law, and the plant failed to reopen within six months and put most of the employees back to work.

State officials filed a wage and benefits claim in the case, on the employees' behalf, and say they're waiting to hear how it will be handled in bankruptcy.

That process could take months.

"We don't know what the court will do," said John Dipko, a Department of Workforce Development spokesman.

It's unlikely the employees will get the full amount of money the state says they're owed, and in many cases it could be much less, according to attorneys who aren't part of the case.

There's a better chance they will get up to $3,000 per employee, said attorney Leonard Leverson with the Milwaukee law firm Leverson & Metz.

"I am assuming that, like most other things in bankruptcy, it will get settled. But it is highly unlikely to be $15,000 or $30,000 per employee," Leverson said.

Finding new jobs

Employees have moved on with their lives. Finding work at another dairy plant has been difficult because those jobs aren't readily available even for people with decades of experience.

Department of Workforce Development officials said they worked closely with the employees and that 72 of them received services through a dislocated worker program.

Sixty-three of the 72 found jobs with an average wage of $19.33 per hour, according to Workforce Development.

But not everyone has been as fortunate, employees said.

Some people have changed jobs several times since the plant closed or they've only been able to find part-time work.

"You start over. But you start over at the bottom," Towe said.

"It's been one hell of a ride. Fifty-eight years old is not the time to be starting over again, doing a 20-year-old's job," said Tim Books, who worked for 20 years at Golden Guernsey and planned to retire from there.

"It sure would be nice to get the money they owe us," Books added.

Charles Stanziale, the U.S. Bankruptcy Court trustee in New Jersey who is handling the Golden Guernsey case, did not return calls. Earlier, he said it was unknown whether the employees would receive what they're owed.

"It depends on how much we have after we pay off everybody, after we pay off the banks, the mortgage holder, priority claims and administration. And then we will see what we have left," Stanziale said in July.

That's not comforting to Joanna Storm, whose husband, Robert, had his career end abruptly with the plant closure and couldn't afford to retire.

"Last year was a roller coaster for many of us. We struggled financially more than we ever thought was possible. We cashed in retirement funds to pay the bills," Joanna Storm said.

"Our house needs a new roof really bad, and we used our 401(k) for living expenses. Our truck needs a lot of work, but we can't afford to have it fixed," she added.

Plant's future

Many of the employees hoped the plant's new owner would rehire them, renewing workplace ties and friendships that were in place for decades. They also miss the pay and benefits from having worked at the same place for many years.

"I knew that we had it good, as far as a decent wage and benefits went, but I didn't know how good until I started looking for other jobs," said Barry Heinzelmann, who worked at the plant nearly 21 years until it closed.

In May, the plant was sold at bankruptcy auction to Lifeway Foods Inc. of Morton Grove, Ill., for $7.4 million.

Two months later, Lifeway President Julie Smolyansky said she hoped to reopen the 170,000-square-foot facility by the end of the year, rehiring at least some of the 112 people who had worked there.

Lifeway indicated it wanted to rehire Golden Guernsey employees because they had the most knowledge of the plant's operations, according to Stanziale.

But a public relations person hired by the company said it's still undetermined when the plant will reopen.

"They are hoping to have this completed by the end of the month," Aly Perlmutter with SS PR, a Chicago public relations firm, said in an email.

The Golden Guernsey plant closing happened so suddenly, no one saw it coming, said employee Eddie Lindsey, who worked there 25 years.

"I was shocked when I came to work on second shift and was told everything was shut down," Lindsey said, adding that a year later he's still looking for a job.

The union that represented the employees, Teamsters Local 695, did not return calls seeking comment. "They were supposed to be negotiating with the new (Lifeway) CEO, but we haven't heard anything," Lindsey said.

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About Rick Barrett

Rick Barrett covers manufacturing, telecom and agriculture. He has received Best in Business awards from the Society of American Business Editors and Writers and was co-recipient of a Barlett & Steele award for investigative business journalism.

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