Hudson’s Bay Bankruptcy: What Employees Need to Know About Creditor Protection & Job Loss

By / March 11, 2025

Hudson’s Bay has filed for creditor protection, putting thousands of jobs at risk (Associated Press, NPR). If you work for Hudson’s Bay, you may be wondering:

  • Will I lose my job?
  • Will I receive severance pay?
  • What financial support is available?
  • What happened to employees in past retailer bankruptcies like Sears and Nordstrom?

Here’s what you need to know.

What Is Happening With Hudson’s Bay?

On March 10, 2025, the Ontario Superior Court of Justice granted Hudson’s Bay’s application for creditor protection under the Companies’ Creditors Arrangement Act (CCAA) (Alvarez & Marsal – Monitor’s Reports).

Key Facts:

  • Hudson’s Bay owes over $1.1 billion in secured debt.
  • The company has missed rent payments on several locations.
  • Hudson’s Bay employs approximately 9,364 employees, including 647 unionized workers.
  • The company has warned that it may not be able to meet payroll obligations within days.
    Source: Business Wire

The CCAA process allows Hudson’s Bay to pause lawsuits and creditor claims while it attempts to restructure. This means employees cannot sue the company for unpaid wages or severance at this time (Companies’ Creditors Arrangement Act – Wikipedia).

For more information on the court proceedings, visit the Ontario Superior Court of Justice website: Ontario Superior Court of Justice – CCAA Cases.

What This Means for Employees

Can Employees Sue for Unpaid Wages or Severance?

No. While the CCAA process is ongoing, a court-ordered stay of proceedings prevents employees from suing the company for unpaid wages or severance.

Will There Be Layoffs?

Layoffs and store closures are likely, but the extent is unclear. The next court hearing on March 17, 2025, may provide more details.

What Financial Support Is Available?

If you lose your job, you may be eligible for government benefits:

  1. Employment Insurance (EI): Apply online through the Government of Canada website here.
  2. Wage Earner Protection Program (WEPP): This federal program may cover some unpaid wages if Hudson’s Bay cannot pay employees. Apply online here.

Lessons from Sears and Nordstrom

Past Retail Bankruptcies in Canada

  • Sears Canada (2017): 12,000 employees affected.
  • Nordstrom Canada (2023): 2,500 employees affected.

What Happened to Employees?

In both cases, courts appointed an Employee Representative Counsel to negotiate on behalf of affected employees.

  • Sears: Established an Employee Hardship Fund ($500,000) to help former employees.
  • Nordstrom: Created an Employee Trust to ensure employees received termination entitlements, including severance and mass layoff pay.

What Is an Employee Representative Counsel?

An Employee Representative Counsel is a court-appointed lawyer who represents employees during CCAA proceedings. Their role includes:

  • Negotiating severance, termination pay, and benefits.
  • Keeping employees informed about legal developments.
  • Ensuring employees have a voice in court proceedings.

Can Employees Opt Out?

Yes. Employees can opt out of the representation within a set deadline. Those who opt out must hire their own lawyer or represent themselves.

What You Should Do Now

Stay Informed & Monitor Communications

  • Watch for official updates from Hudson’s Bay, your store management, or HR.
  • If you are part of a union, contact your representative for specific guidance.
  • If an Employee Representative Counsel is appointed, review any communications regarding your rights and options.

Prepare for Potential Job Loss

  • Update your resume and LinkedIn profile.
  • Look into alternative job opportunities.
  • Check if you qualify for EI benefits and WEPP if you are laid off.

Seek Information from the Monitor’s Website

For further details on the CCAA proceedings and employee rights, visit the Monitor’s website: Alvarez & Marsal – Hudson’s Bay Canada Monitor’s Reports.

Monkhouse Law
Latest posts by Monkhouse Law (see all)