Essendant, a long-standing wholesale office supply company, plans to lay off nearly 1,300 employees as it winds down operations. The company’s decision might breach Illinois employment laws, specifically the WARN Act, by allegedly not providing the required 60-day notice to hundreds of workers.
The Illinois Department of Labor is investigating these abrupt layoffs, which occurred five weeks earlier than anticipated. Paul Cicchini, a spokesperson for the department, confirmed the investigation is based on a received complaint.
Essendant, formerly United Stationers, grew from a small Chicago store into a leading wholesaler of office products. In recent years, the company has struggled under private equity management, especially with the shift towards remote and hybrid work.
In August, Essendant announced the closure of its Lincolnshire headquarters and a distribution center in Carol Stream. This announcement included planned layoffs of 510 and 134 employees respectively, set for October. Surprisingly, many employees were abruptly dismissed in August through a mass video call. A follow-up letter confirmed the last day of employment as August 31 without offering severance or benefits.
Essendant’s actions fall under the purview of the Illinois Worker Adjustment and Retraining Notification Act, which mandates 60 days advance notice for closures or mass layoffs in companies with 75 or more employees. Any violation may lead to back pay and benefit recoveries for affected employees. The company could also face daily penalties for each day of notice violation.
Law firm Strauss Borrelli is investigating potential violations of the WARN laws at Essendant locations beyond Illinois and seeks input from former employees lacking notice or benefits.
Essendant issued WARN notices for closures in other major cities like Atlanta and Dallas, totaling 1,278 layoffs. The notices indicated efforts to explore strategic alternatives, including asset sales and additional capital pursuits, though the success of these efforts remains uncertain.
Essendant’s history dates back to 1906, originating in Chicago. Over the decades, it grew into a leading wholesale office supply firm, renamed Essendant in 2015, and acquired by Sycamore Partners in 2019. Persistent challenges led the company to shift focus from office supplies to janitorial and foodservice items.
The company relocated its headquarters to Lincolnshire in March, but offices and distribution centers are now closing. Essendant’s website spoke of a new direction aimed at positioning itself for long-term growth, but those plans did not come to fruition.
Meanwhile, as Essendant struggles, Sycamore Partners continues its activities, recently acquiring Walgreens in a significant financial deal.
The future looks bleak for Essendant as it potentially closes its doors after over a century of operations, leaving many employees without jobs sooner than they expected.