Koffee Kup employees forced to return earned time pay out

Updated: May. 8, 2021 at 5:12 PM EDT
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BURLINGTON, Vt. (WCAX) - Former Koffee Kup Bakery employees are coming forward, saying the now-closed business has dealt another blow, sending some people’s bank accounts into the red.

As the future of Vermont’s Koffee Kup Bakery remains up in the air, some employees woke up on Friday to find out the bank had taken back vacation time, which was already paid out. Gary Pasquale was one of them. On Thursday he and other workers received accrued vacation and sick time they’d saved up over the years. Pasquale paid off outstanding bills, and then went to buy a pair of boots for his new job.

“And I was declined,” Pasquale said. “I called my bank and I’m minus $300.”

Pasquale and numerous other former employees tell WCAX News Koffee Kup reversed the payments, which over drafted some employees’ bank accounts. Other employees say some cashed out on hundreds of hours of PTO, totaling thousands of dollars.

However, the specific reason why employees had to return benefits is unclear. Former sales representatives with Koffee Kup tell us that there’s a disagreement between who should be responsible for paying out employee obligations.

Chad Carpentier, a former sales rep with the company, says there’s still money coming into the company from orders placed before its abrupt closure a few weeks ago. “There are still funds coming in,” Carpentier said. “Not that that matters because the funds to pay these people are available in any account. We know that because the deposits cleared.”

Koffee Kup is now owned by American Industrial Acquisition Corporation. Jeff Sands, a managing member of Dorset Partners LLC, tells us in an email that he is not directly involved in payroll. He adds that he suspects the court-appointed receiver is in charge of payroll.

KeyBank writes in a statement, “The sudden closure of Koffee Kup Bakery is truly an unfortunate situation for all concerned. For client privacy and legal reasons, KeyBank is unable to comment on any issues related to the client’s account.”

The financial turmoil comes against the backdrop of a class-action lawsuit brought on by the former employees who claim Koffee Kup violated federal law, requiring companies give 60 days notice before closing.

But as legal and financial challenges persist, some are interested in Koffee Kup, including prospective buyers who took a tour of the Burlington plant Saturday.

Pasquale says he’s loved his time at Koffee Kup and that he’s worked just about every position over the last eight years.

“I started at the bottom, I worked my way up, they’ve given me that opportunity,” Pasquale said. “They’ve paid me well, I’m close to home, I’ve loved the people I’ve worked with. But now I could never come back and trust this place, no matter who it’s owned by.”

But Pasquale and some of the other 240 laid-off employees say the loss of Koffee Kup has been painful, as they say goodbye to the workplace they loved. And they say part of that closure involves getting the benefits they’re entitled to.

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Can Koffee Kup be reopened?

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Koffee Kup Bakery shuts down, lays off more than 200 workers

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