After the world’s largest kayak manufacturer, Hemisphere Design Works, announced this week it is shuttering two of its Muskegon facilities and laying off at least 68 employees, city officials are scrambling to support unemployed workers—and are attempting to assess the future of a company that opened its downtown Muskegon headquarters just last year and had employed some 600 workers at one point.
“It’s never ideal when a company ceases operations,” said Jake Eckholm, the city of Muskegon’s economic development director. “There’s going to be a transition of jobs. The silver lining is we have more open manufacturing positions than we can fill in the Muskegon area. There’s a good absorption rate for those folks [who have been laid off].”
“I would’ve been extremely concerned if this happened five, six years ago, but given the diversification of our local economy and open manufacturing positions, we’re not as concerned about the absorption of that workforce,” continued Eckholm, who noted city officials are working with local employment agencies, such as West Michigan Works!, to connect laid-off employees from Hemisphere Design with available jobs.
“We want to make sure all hands are on deck to help transition these workers so they can provide for their families,” Eckholm said. “We want to make sure these folks are rolled into some of the open positions we’ve been having trouble filling.” [For those who have been laid off from Hemisphere Design Works, you can contact West Michigan Works! by going to their office at 316 Morris Ave. in Muskegon or by calling 231-724-6381.]
Hemisphere Design Works informed the state of its plans to close its two plants at 1790 and 1880 Sun Dolphin Dr. in Muskegon in an Oct. 30 notice filed with the state’s Workforce Development Agency [which you can see here]. Hemisphere’s brands include SunDolphin, Future Beach and Evoke.
Known as a “WARN” notice, which employers legally must provide to the state prior to mass layoffs, the document filed with the state said it would permanently close the two facilities at 1790 and 1880 Sun Dolphin Dr., located not far from E. Sherman Boulevard in the city’s East Muskegon neighborhood, by Dec. 29. The company also said 68 employees are expected to be laid off.
“The Company has been in the process of seeking capital which, if obtained, would have enabled it to avoid or postpone a closure and continue operations,” Kiley Sluis, Hemisphere Design Works’ human resources manager wrote in the WARN notice. “Unfortunately, the Company’s efforts have not been successful and the Company has unexpectedly learned that the term lender will not provide additional funding. As a result of this unforeseen business circumstance, the Company will now be forced to permanently close the facilities identified above and is providing as much notice as practicable of this closing.”
Hemisphere Design Works did not respond to repeated requests for comment.
While between 140 and 150 employees currently work for Hemisphere Design Works—or did as of this week, according to former employees and city officials, the company said 68 workers would be laid off. Employees began being laid off on Oct. 29, and layoffs will continue through the end of December, according to the state filing. It is unclear what the company’s plans are for the other employees, though city officials said they expect them to also be laid off by the end of the year.
The past—and future—of the world’s largest kayak manufacturer
Founded in 1982 by Kenneth Harris and based in Muskegon since 1989, KL Outdoor went on to become one of the biggest names in water sports. Known as the largest kayak manufacturer in the world, KL Outdoor and its iterations that followed—KL Outdoor/GSC and ultimately Hemisphere Design Works—also made stand-up paddle boards, canoes, paddle boats, and more. Following Kenneth Harris’ tenure, the company was run by his sons, Tom, Ken, Dan, and Dave Harris.
The Harris family sold KL Outdoor to New Water Capital Partners, a private equity firm headquartered in Florida, at the end of 2016. In 2017, KL Outdoor LLC and the Montreal, Quebec-based GSC Technologies Inc. merged; the name Hemisphere Design Works was born in 2018.
Long touted as a major economic player in the region, community leaders were thrilled when the company, then known as KL Outdoor/GSC, moved its headquarters to an 18,000-square-foot downtown venue perched along Muskegon Lake in January 2018. Located at 700 Terrace Point Dr., the headquarters was shuttered when we attempted to visit Wednesday, Oct. 30, and Thursday, Oct. 31. It was the first corporation to locate its headquarters in downtown Muskegon since 2000.
Now, as Hemisphere Design Works ends its operations, Eckholm said there remains the possibility that the company could still have a future in Muskegon.
“Given that this business is owned by an equity firm [New Water Capital Partners], there’s every possibility they could sell it and they could continue production,” he said.
New Water Capital Partners did not return requests for comment for this article.
‘I’ve never worked in such a dysfunctional and misguided place’: Former employees share stories of a chaotic workplace
Should the company be revived, former employees said they hoped it would return to its roots—that it would operate as it did when the Harris family ran it.
The former employees said they loved working for the Harris family, but, following New Water Capital’s acquisition of KL Outdoor and the launch of Hemisphere Design Works, they said the company devolved into chaos.
“Before the company went to the new owners, things were great,” said Sonja Tjapkes, who worked at Hemisphere Design Works for about one year before she was laid off this past March. “The Harrises were amazing people to work for. When the company switched over, something went down.”
“I saw some crazy things go on; they got upset with one of our mechanics because he couldn’t fix the line in 20 minutes,” Tjapkes continued. “He’d worked there for years, and they fired him on the spot. If the Harrises still had the company, there would still be KL and plenty of jobs. We’d still have the Dick’s contract.”
According to employees, Dick’s Sporting Goods ended a significant contract for kayaks with Hemisphere Design Works months ago (Tjapkes said she knew of it before she was laid off in March). This led to a troubled financial landscape for the company, though former workers said they lay most of the blame on company mismanagement for Hemisphere’s troubles.
All of the former employees we interviewed described a workplace in which employees routinely had to wear winter coats because it would get so cold inside their building, managers were verbally abusive, the human resources department was unresponsive, and bathrooms were filthy. Anthony Kolberg, who quit his position with Hemisphere Design Works in March, said an employee even found a “clear garbage bag full of blood” in the bathroom at one point. (That bag, which Kolberg saw and said was about a couple pounds of blood, was ultimately thrown out in the trash by a supervisor. A supervisor then said the blood came from a nose bleed, according to Kolberg.)
Tjapkes said the company would routinely withhold wages for no apparent reason for both her and her fiance. When they questioned human resources about it, they were either told they couldn’t prove they worked the hours they claimed (in part because there were times employees would have to manually submit their hours on pieces of paper because the company’s clock system was down) or that the matter would be further investigated. Eventually, Tjapkes’ fiance quit because the company continued to withhold money from him, according to Tjapkes.
“We were expecting at least an $1,100 check, and when he got his check, it was just over $200,” Tjapkes said. “We were like, ‘What the hell?’ The next pay period came around, and we thought his pay would be upwards of $900. It was around $180. This was when he was working 12, 14-hour days. He went to HR, and she just did not care.”
Meanwhile, Tjapkes said she received a check that was missing pay for about eight hours of overtime.
“I went to my plant manager very upset; I was like, ‘Look, I know I came in on a Saturday for eight hours, and you’re saying I didn’t even work it?’” Tjapkes said.
After reporting this to human resources, Tjapkes was told the company would not pay her for those eight hours “because they said I couldn’t prove I worked that day, even though there should be surveillance showing my car pulling in and out.”
“I was told I’d be given $35,” Tjapkes said. “I said, ‘I worked for eight hours on a Saturday, and you’re going to give me $35? It was crazy.”
After the company moved employees into a facility behind Pizza Ranch in East Muskegon, Kolberg said there were significant issues, from little heat to plumbing problems (things got so bad that Kolberg said employees would often use the portable toilet outside their office).
“People actually started to go to the bathroom on the floor in the building,” Kolberg said. “After that happened, human resources came over and said one day a month, each person would have to clean the bathroom. When someone said they wouldn’t, she [the human resources employee] said, ‘You will or there will be disciplinary action.”
“I’ve never worked in such a dysfunctional and misguided place,” said Kolberg, who is now happily employed elsewhere.
Bessie Dixon, a former employee who was fired in March, also emphasized the difficult conditions inside the workplace.
“It was freezing cold in there,” Dixon said. “We had a couple people quit because it was so cold. There was this boss who would cuss people out.”
Dixon too has found work elsewhere, which she said she likes “so much better—and it’s warm.”
For many of those being laid off now, life is going to be difficult heading into the holiday season, Tjapkes said.
“One of my best friends, both her and her mother worked there, and now there’s no income for either of them,” she said. “It’s super sad.”
“People have lost friendships overnight,” Tjapkes said of the laid-off employees to whom she said their colleagues often felt like family. “Everyone’s just scrambling, trying to figure out where to go next.”
When Tjapkes was laid off in March, she said company officials told her there was the chance she’d be able to come back once Hemisphere regained its financial footing.
“They told us this was a period for them to figure out what’s going on,” she said. “I had heard through the grapevine that they were going to go belly up. They did this huge job fair and hired upwards of 50 people and then let them all go, every last one of them, probably a month and a half later. Why?”
Still, Tjapkes said she would have returned to the company after she was laid off, in large part because of the camaraderie she found there.
“I loved the people and wanted to go back,” she said.
But others said they would never want to return.
One former employee, who wished to remain anonymous, said he was harassed while working at Hemisphere Design Works for being transgender.
“Someone was going around telling everyone I was transgender; I didn’t want to tell people that because it can be hard to make friends,” he said. “I said, ‘This is harassment.’”
After months of attempting to reach human resources about this issue, he finally reached them and they brought this individual and the person harassing him together. The harasser denied any wrongdoing, and human resources took no action.
“That was a tipping point for me,” he said. “I’m four years into my transition, and that really affected me when I was outed and he was not disciplined in any way.”
Now, as Hemisphere Design Works employees find themselves facing unemployment, Tjapkes said she hopes their struggles are short-lived.
“I would hope everybody who lost their jobs keeps their heads held high, and they find peace with all this,” Tjapkes said. “I hope we as a community can come together and move forward.”
Still, she knows it’s going to be a deeply difficult time.
“It’s the holiday season,” she said. “Most workers there are single parents. Most of us are living paycheck to paycheck, and now it’s paycheck to no paycheck.”