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Penn Foster parent company bankruptcy results in lay-offs


JUNE 2013, Scranton/Wilkes-Barre/Hazleton Edition of The Union News

Penn Foster parent company bankruptcy results in lay-offs


REGION, May 30th- Lay-offs of local workers have resulted since the parent company of the Scranton based Penn Foster Career School has filed for bankruptcy protection.

The Boston based Education Holdings 1 Inc., filed for Charpter 11 bankruptcy in Delaware claiming $100 million to $500 million in assets and an equivalent level of liabilities.

Penn Foster has two facilities in Northeast Pennsylvania including the education center on Oak Street in Scranton and a warehouse facility in Ranson Township. The company was once known as the Intermational Correspondence School (ICS).

Most of the former ICS employees are represented by the United Steelworkers of America (USW) Union Local 5652 including the education center and the warehouse. However, the company has met with the union and announced they plan to close the warehouse.

USW officials have met with management to discuss a new Collecive Bargaining Agreement (CBA) and effects bargaining for laid-off workers and future lay-offs.

However, during negotiation meetings between the two parties company representatives have proposed changing Article 8 of the current CBA attempting to cut or eliminate employees severance pay.

Under the CBA, all regular full-time employees that are permanently terminated from employment with the Company because of closing, subcontracting, or discontinuance of a unit or department, are entitled to severance pay, which the employer representatives proposed to eliminate.