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Popular Restaurant Chain Files for Bankruptcy, Shuts Down Locations

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Popular Restaurant Chain Files for Bankruptcy, Shuts Down Locations
Source: Instagram/Domschicago

Popular Restaurant Chain Files for Bankruptcy, Shuts Down Locations

Source: Pinterest

When Dom’s Kitchen & Market and Foxtrot Market, under Outfox Hospitality, two of Chicago’s biggest restaurant chains merged six months ago, they hoped to help each other fix some of their internal struggles. However, this did not work out well, as they announced an unexpected shutdown.  

An Unexpected Closure

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On Tuesday, April 30th, every Dom’s and Foxtrot store closed its doors from the last time. Dom’s company statement read, “Each and every Dom’s and Foxtrot store closed Tuesday.” While some might wonder if this only applies their physical stores, the company clarified that it also affects their delivery services and mobile applications. In addition, all stores credit cards were deactivated that day.

Possible Bankruptcy

Source: Pinterest

The merger was the first indication of a struggle for the two companies that joined forces under Outfox Hospitality. While the intention was for it to help both Foxtrot and Dom’s, it may have done the opposite by straining the company’s resources. It has not yet filed a Chapter 7 bankruptcy, but many industry watchers believe it’s only a matter of time before that happens.

Impact on Employees and Customers

Source: Instagram/Domschicago

Since the companies suddenly shut down, the employees will be most affected. They let go of hundreds of workers across different locations, and now, those people have to go job hunting again. Perez now has to face reality and look for a new job to keep herself afloat. “I don’t got a job now. Now I’ve got to go back and search for a job,” she said.

Employees React

Source: Instagram/Domschicago

The company employees are just as shocked as the general public about the closures. This is because the company did not give them the appropriate notice for closure. Monica Perez, an affected employee said, “We just got here, and apparently everything is closing, so a lot of people—everyone here—are out of work now.”

The Impact on Employees

Source: Pinterest

Since the companies suddenly shut down, the employees will be most affected. They let go of hundreds of workers across different locations and now, those people have to go job hunting again. Perez now has to face reality and look for a new job to keep herself afloat. “I don’t got a job now. Now I’ve got to go back and search for a job,” she said.

Customers Are Unhappy

Source: Instagram/Domschicago

The regular customers of these restaurants are also quite unhappy with the closures. Due to their high standards, these spots were the favorite for some people and a regular place to eat for others. A frequent customer, Amy Tanner, said she was “shocked and really upset” because “we literally just come down here to decide what we’re going to have for dinner every night.”

The Impact on the Local Economy and Real Estate

Source: Instagram/Domschicago

The customers and employees are unhappy with this decision, but its biggest impact might be felt in the economy. This is because the companies have closed 17 locations around Chicago, causing a notable shift. However, people interested in real estate have capitalized on this and are now contacting real estate agents, hoping to buy off these properties at a cheaper rate.

An Odd Notification of Closure

Source: Instagram/Domschicago

The companies notified their employees and customers of the closures in an unusual way. This was by posting signs on the stores of all the stores. At a Foxtrot store, a sign read, “As of today we are closed for the final time. Thank you for the time we had together.” Therefore, the employees are quite upset by this, asking why the company didn’t follow the legal process for shutdown.

Looming Legal Issues

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A huge lawsuit may be looming over the companies because of the way they announced the shutdown to their employees. This is because they potentially violated the WARN Act which seeks to protect employees from abrupt termination. An attorney, Laura Feldman gave her opinion, saying it as possible because “these employees, it seems like, were given not even a minute’s notice.

Possible WARN Act Violations

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The possible WARN Act violations could be traced back to the parent company, Outfox Hospitalilty. The act requires a 60-day notification for layoffs of this size. Therefore, people are already complaining that the company didn’t follow the right procedures. However, legal experts are divided on this issue, as a possible suit might end in either the company’s or employees’ favor, judging from other similar cases.

Communities Set Up Initiatives

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In order to help the employees who lost their jobs so suddenly, members of the local communities have set up some initiatives. These involved hiring fairs, online fund raisers, and other efforts to help those who have now found themselves without jobs. As the members of the communities band together, they are helping these affected employees to find their way again.

An Uncertain Future

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Moving forward, there are a lot of uncertainties. “We’ll see what happens, if this is a reorganization, or if it’s just something going on financially, but it’s kind of weird that they’d throw everybody out and shut things down,” Matt Tanner, a regular customer and community member, said. This is the same feeling most people have, as they have no choice but to watch things unfold.