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Union Challenges Target’s Zellers Takeover

(Filed Under Real Estate News). The Target Corporation is attempting to prevent Zellers employees from maintaining their union status after the U.S.-based retail giant acquired 189 leaseholds of the Canadian discount mass-merchandise chain earlier this year.

Target has announced plans to convert approximately 135 of the 189 Canadian stores to the Target name by March 2013 and will hire new staff members for each store. Approximately 15 Zellers locations are currently unionized, and a test case has been submitted to the British Columbia Labour Relations Board to declare Target as a "successor employer" to Zellers, allowing staff at a Burnaby, B.C. Zellers to keep their jobs and union status.

Lisa Gibson, a spokeswoman for Target Corp., said in a statement that the company believes its acquisition of Zellers "is a real estate transaction and not the acquisition of a business, technology or employees. As such, we do not believe Target is a successor employer under applicable law and do not believe there was reasonable cause to file a successorship application." The company will contest the union’s case.

Thirty-nine of the remaining Zellers leaseholds belonging to Target will be resold to Walmart Canada, while the other leases will be sold to other retailers or returned to landlords. The remaining 84 Zellers stores not acquired by Target will continue to operate normally until the Hudson’s Bay Company, Zellers’ parent, makes a decision regarding the future of the chain.

The Toronto-based Hudson’s Bay Company operates Canadian retail chains The Bay, Home Outfitters and Fields in addition to Zellers. The Minneapolis-based Target Corp. recently formed subsidiary Target Canada, headquartered in Mississauga, Ontario.

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Published 12-07-2011 by Katherine Rautenberg

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Union Challenges Target’s Zellers Takeover

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