Sheertex Layoffs: Tariffs and Funding Woes Force Major Cuts
Why is the reason for Sheertex Layoffs?
Montreal-based hosiery brand Sheertex is making significant staffing cuts, with 40% of its employees temporarily laid off. The company, known for producing ultra-durable tights, is struggling with financial pressures that include delayed funding and looming U.S. tariffs.
Before the layoffs, Sheertex had a workforce of approximately 350 people. Now, a substantial portion of its staff is facing job uncertainty as the company navigates a challenging economic landscape.
What Financial Challenges Is Sheertex Facing?
According to CEO Katherine Homuth, the company’s latest round of fundraising has yet to be fully secured, creating financial instability. This delay in securing capital has left Sheertex in a difficult position, making workforce reductions necessary to sustain operations.
A major concern for Sheertex is the U.S. government’s proposed 25% tariff on Canadian imports. Since 85% of Sheertex’s sales come from the U.S. market, these tariffs pose a significant financial burden.
What Is the De Minimis Exemption, and Why Does It Matter?
Adding to the company’s struggles is the potential removal of the de minimis exemption. Previously, direct-to-consumer shipments under $800 were duty-free. If this exemption is eliminated, Sheertex would not only face the 25% tariff but also an additional 16% duty, making its products substantially more expensive for American consumers.
Is There Any Relief on the Horizon?
The U.S. has temporarily paused the implementation of these tariffs for a month, but Homuth believes this short-term delay is insufficient to provide meaningful relief. Without long-term solutions, Sheertex and other Canadian businesses reliant on cross-border sales remain in a precarious position.
As the situation unfolds, Sheertex is working to navigate these financial and trade challenges while aiming to secure its future in a shifting economic landscape.
Have You Been Laid Off? We Can Help.
If you’re a Sheertex employee in Canada impacted by the recent layoffs, it’s important to understand your rights regarding severance pay. Severance is typically determined by factors such as your role, tenure, and age. In some cases, non-unionized employees may be entitled to severance packages that extend up to 24 months’ pay.
At Whitten & Lublin, our employment lawyers specialize in helping employees navigate their severance entitlements. We’re here to ensure you receive fair and just compensation during this transition. If you’ve been affected by Sheertex’s layoffs, reach out to us for a consultation contact us online or by calling us at (416) 640 2667.