California Fitness employees received an email from the company on Tuesday stating that they are to be suspended with pay. The email comes after notices were posted on California Fitness branches in Wan Chai and Mong Kok the day before saying that 12 fitness centre branches under the names California Fitness, mYoga, and LEAP are to be temporarily suspended until further notice.
J.V. Fitness Limited, the parent company of the three brands, is currently facing a winding-up order sought by major shareholder PK Wong, who was one of the company’s former board members. A court hearing, scheduled for August, has led to a freeze on the company’s assets.
The Labour Department told reporters that they are assisting 260 employees who came to them for help.
The department told Apple Daily that it has already conducted investigations and surveys of many of the branches on July 8 and 11. They are investigating whether the Employment Ordinance has been violated because of unpaid wages and have also set up a hotline for affected employees.
Apple Daily reported that talks between Wong and Bryan To, a potential buyer of J.V. Fitness, were leaked to the paper on Tuesday. In the recording, Wong was heard saying he was displeased that To asked him to leave a HK$20 million deposit so that “things can be settled.” In that case, “I’ll just f**ing close the company” said Wong.
In the recording, Wong also appeared to be delaying requests to show To the company’s books. “I don’t care how much the [debt] is, I just want to see something,” said To, referring to the books.
Wong told Next Magazine that several buyers are now backing off because of the negative reports and that he wanted to sell the company because his family was being investigated by the Customs department for violating the Trade Descriptions Ordinance. He said that To has never given a price for the deal.