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Goodwill employees will not be paid this week, suffer a ‘devastating blow’

Local union steward James Nickle comforts co-worker Raphelia Debique as Goodwill employees hold a press conference at a store in Scarborough on Jan. 20.

Kevin Van Paassen/The Globe and Mail

Goodwill announced on Wednesday that workers in the Toronto region will not be receiving paycheques this week, as employee anger continued to mount amidst the organization's ongoing financial collapse.

"Despite our best efforts, employees will not be paid on Friday as part of the regular pay cycle," beleaguered chief executive officer Keiko Nakamura said in a statement.

Goodwill Industries of Toronto, Eastern, Central and Northern Ontario has not paid employees for hours they worked since their last paycheques up until Sunday, when the organization announced it was abruptly closing its 16 stores and 10 donation centres in the Toronto area. Several workers say their benefits have also been cut off, leaving some without medication. Goodwill managers have been attempting to secure bank financing to pay workers.

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Through a spokesperson, Ms. Nakamura declined to comment on whether she would continue to receive her salary, which stood at $206,763 in 2013, according to the provincial Sunshine List.

The union representing Goodwill workers called the failure to pay wages "a devastating blow."

"We are very angry," said Moe Rutherford, business representative for the Canadian Airport Workers Union, which represents the 430 Goodwill employees. "It's not fair. It's not humane."

Joe Petti, a janitor at the Goodwill store on Progress Avenue in Scarborough for 31 years, said he will now have to borrow money from his brother to buy food.

"It's humiliating what she's done to us," he said of Ms. Nakamura. "I have no faith in her. No faith."

Raphelia Debique, who had been working at another east Toronto location for nine years, expressed a widespread sense of betrayal on Wednesday.

"We are the people with the barriers that they vow to hire, to help, to move up, to have a better life," Ms. Debique said. "She didn't give us a better life. She took an 80-year-old company and demolished it."

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At a news conference outside the Progess Avenue location on Wednesday, many out-of-work Goodwill employees called for the CEO's resignation, chanting "Keiko Must Go."

Meanwhile, the union says it has spoken with unidentified potential "investors" who are willing to take over the charity's operations and reopen its shuttered stores in Toronto, Mississauga, Brampton, Newmarket, Barrie, Orillia and Brockville, but it provided no details Wednesday about the mysterious bailout offer.

The CAWU issued a statement saying it has talked with potential new partners and put them in contact with Goodwill management, and it is urging the non-profit organization "to seriously consider relinquishing control to the new investors."

Goodwill Industries is a registered charity and cannot sell itself to new investors, but it can receive donations and use the money to support its operations.

Union lawyer Denis Ellickson said there are at least two different groups of people with experience working with the charitable sector who are prepared to contribute funding and take over its operations.

"The union is encouraged if that's the case," Mr. Ellickson said.

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At the news conference, local union steward James Nickle said the "investors" were seeking financial details from Ms. Nakamura.

"What they need from Keiko is financial statements about how much she owes," he said.

The organization's 12-member volunteer board resigned on Friday, but Ms. Nakamura has continued in her job, saying she is trying to find a solution to keep the stores open. In her statement Wednesday evening, she said the company will update employees about payroll deposits and records of employment – which would allow workers to collect employment insurance – on Monday.

She told reporters on Monday that the organization is facing a cash-flow crisis in an increasingly competitive retail environment and was operating with thin margins.

Also Wednesday, the union said it has sent a letter to Premier Kathleen Wynne asking her to intervene to help save Goodwill.

"We need help from the government, the media, the population," said Zahra Mohamed, who worked at the organization's Brampton location. "We need help immediately."

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Real Estate Reporter

Janet McFarland is the real estate reporter for The Globe and Mail’s Report on Business, with a focus on residential real estate trends. She joined Report on Business in 1995, and has specialized in reporting on corporate governance, executive compensation, pension policy, business law, securities regulation and enforcement of white-collar crime. More

Eric Andrew-Gee has covered national news for the Globe and Mail since 2015. He previously worked at the Toronto Star, where he was a reporter, and Maisonneuve Magazine, where he was an editor. Eric won the 2015 Goff Penny Award for Canada’s top newspaper journalist under 25. His work has also been nominated for two National Magazine Awards. More

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