The retirees have gathered monthly in a nondescript meeting room just outside Chicago for years, patching in conference calls from around the country and reminiscing about the old days when they proudly worked at Sears, “where America shops.”
Those mid- to late-20th century days were a time of stiff white shirts, die-hard company camaraderie and the opportunity to make lots of money. Sales and profits were up, promotions were frequent and profit-sharing was standard for many. Working for the country’s largest retailer was an honor, retirees say.
But more recently, the walks down Sears memory lane have turned to worrying – about the state of the stores, Chairman Edward Lampert’s turnaround plan and, closer to home, the future of their retirement and life insurance plans. Just last week, the company announced another round of store closers that included the store at Columbia Place mall at Two Notch and Parklane roads in Columbia.
One of the 124-year-old retailer’s mottos was “Sears has everything,” and for its employees the mantra rang true. Over the years, however, restructuring and financial challenges eventually ended many of those popular perks.
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The profit-sharing fund was dropped in 1978. The pension plan was frozen in 2005. Life insurance coverage was slashed in 1997. Last year, Sears employees who retired before 2000 lost a monthly health subsidy of $37.
Sears Holdings Corp., now the corporate entity for both Sears and Kmart, says it maintains a regular dialogue with its retirees, including a newsletter designed to keep them up-to-date on the company, and Lampert recently told the Chicago Tribune the company has honored its obligations to retirees and pension beneficiaries.
Nonetheless, since a company warning earlier this year that it’s uncertain about its future, many retirees say they are less concerned about their pensions than their life insurance payout, which averages roughly $10,000, according to Ron Olbrysh, chairman of the National Association of Retired Sears Employees.
Most are 70 and older, and some are not in good health. They worry about what would happen to Sears’ funding of their life insurance policies if the company files for bankruptcy.
Retirees who sat down with the Tribune to reflect on their time with the company say it was Sears’ inability to look ahead and keep up with changing times that led to its decline. Company watchers agree.
“It was a great business until the people at the top decided that strategy didn’t matter for them and that they would forever be able to play the same game and win,” said James Schrager, clinical professor of entrepreneurship and strategy at the University of Chicago’s Booth School of Business.
“This is a story we see all the time,” Schrager added. “Sears was not the first, and will not be the last company to decide that strategy doesn’t apply to them.”
‘Parent’ to headquarters
Ron Olbrysh, 75, remembers when Sears was the place to be – not only for shoppers, but for workers.
In 1972, Olbrysh left a government job in Cleveland for work as a trademark attorney at Sears. He chose the retailer over a job at General Electric because the well-regarded retailer “made me an offer I couldn’t refuse,” he said.
By the time he retired in 1996, he was an assistant general counsel.
“The benefits were great,” Olbrysh said. “We had profit-sharing, which was always an incentive to work at Sears.”
When Olbrysh began with Sears headquarters on the city’s West Side, employees referred to the complex as the parent.
Over the years, as the company diversified its business, picking up financial firms such as Coldwell Banker and Dean Witter, “parent” gave way to “headquarters,” and the company’s culture changed, Olbrysh said.
“When it was ‘parent,’ it was like a family. When it changed to ‘headquarters,’ it wasn’t as close as it used to be.”
‘You were all in it together’
The “family feeling” is what Elaine Leonard loved about working for Sears. In 1967, the mother of two took a part-time sales position working evenings in the toy department at a Sears store outside Chicago. She and her husband planned to buy a house and the additional income would come in handy.
“When you came to work, it felt like you were coming to your second home,” she said. “You felt like it was family. You were all in it together, you were all working together.”
The money she earned helped the family buy its first home.
When Leonard retired in 1993, she was working at Prairie Stone in the workforce diversity department. She handled everything from hiring to firing, and discrimination suits as well. “If you had a problem, you knew you could come to a manager and someone would help you … it was like your second home.”
Leo McCormack, 79, worked his way through Boston College in the late ’50s delivering caskets and appliances for Sears.
After graduation and a three-year stint in the Marine Corps, McCormack started a yearlong Sears training program and began working in Brockton, Mass., as a department manager.
By the time he retired in 1993, he was the labor relations manager for the product services division, negotiating with unions on Sears’ behalf. It was a job he said he was proud to do, because he was proud of what the company had to offer workers.
Looking back, though, he remembers concerns about the company’s naivete when it came to keeping up with a rapidly changing retail landscape.
“Sears didn’t realize that everybody that ran a (cash) register was their competition,” McCormack said.
In 1997, he became one of the founding members of the retirees group and a year later joined about 100 fellow retirees sporting yellow shirts marching outside the company’s 1998 annual meeting shouting “Shame on Sears.” They were protesting then-Chairman Arthur Martinez’s decision to reduce life insurance benefits for 84,000 retirees, saving the retailer $1.4 billion.
For the event, McCormack built a replica of a pine coffin with a sign declaring “Sears Retirees DieHard.” It remains in the attic of his garage.