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Cabinet Business Closes Under Excessive Debt and OSHA Penalties

In San Antonio, a 37-year-old cabinetry business, Cardell Cabinetry, was forced to close their doors. They were apparently going under financially with debts of $45 million hanging over their head. With no warning, around 900 employees found themselves unemployed. Employees arrived at work only to find themselves denied entry to the facilities.

In addition to the company's huge debt, the Occupational Safety and Health Administration (OSHA) recently visited them and dropped a $267,434 penalty in their lap, citing 29 violations. One of the OSHA violations was just for combustible dust. Some of these violations might have been prevented if an attorney had been present during the inspection.

Cardell Cabinetry was started in 1976, and shortly afterwards, acquired by Bill Tidwell. The company was a member of the Kitchen Cabinet Manufacturers Association and was for a very long time. The executive vice president of the association was saddened by the news and referred to the company as "a major casualty of the economy."

Cardell's 900,000 square feet of manufacturing space was divided between its two locations. The primary location was in San Antonio, with a second facility in El Campo. H.I.G. Capital, who owns equity in several similar-type companies, such as American Hardwood Industries, Innovative Building Systems, Linden Lumber and Republic National Cabinet, also owned a good amount of equity in Cardell, which they purchased in 2010.

No one wants to see a business of this size go out of business, and it is unclear if the OSHA violations might have helped push it over the edge. Companies should know that OSHA violations can be appealed and sometimes dropped to a much lesser degree by retaining a good attorney. Employers should also be diligent in taking proactive steps to ensure their workplace meets all of the safety and health standards set forth by the OSHA.

Source: woodworkingnetwork.com, "Cardell Cabinetry Out of Business" Karen Koenig, Sep. 10, 2013

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