KNOXVILLE, Tenn. (WATE) – A local hair salon closed its doors the day before Thanksgiving, but very little notice was given to employees and no notice was given to most clients.
GEO Hair Lab opened its doors in 2015 with an innovative flair new to Knoxville, an eco-friendly salon that recycled all of its products.
The owner, Jeremy Wann, told employees on November 22 that the salon was closing.
News of salon closing came after paychecks bounced
The news, however, came a few days after all 30 employees’ paychecks bounced.
Brianna Officer, a former hairstylist at GEO, said it wasn’t the first time one of her paychecks bounced.
Officer and another employee, Bekki Vaden Ottinger, said that the currency of paychecks had been changing for a few weeks, or they were late.
Both employees said that Wann would give different excuses as to why they would get paid via Venmo, a cashier’s check or a personal check without a pay stub.
Wann told 6 On Your Side that the money really issues started when the salon changed online booking systems for client appointments.
Owner Wann: Lack of online scheduling caused money woes
He said clients weren’t able to schedule online for three weeks of September, which ultimately cost about $60k in projected revenue.
Officer and several other employees say they believe that couldn’t have caused thousands of dollars of lost revenue.
“It was still manageable. Like, it wasn’t just like ghost town. It just wasn’t as busy as it could’ve been,” Officer said.
She said that clients were still coming in, but it business was more like a normal January — the slow season.
Vaden Ottinger said there were other clues within the last year that she believed, in hindsight, showed money was becoming an issue for the salon.
Vaden Ottinger worked as the creative director at GEO. She helped at the reception desk as well as helped with interior design in the shop.
She said that she had to pay for some project supplies for the salon with her own money, and wasn’t paid back.
Officer was also confused as to how money was an issue for the salon because they were always busy, and stylists had to pay a $420 booth rental fee.
“If I’m paying $20,000 a year (for booth rental) just to work, where did the money go?” Officer asked.
She said about 20 other stylists were paying a similar booth fee.
About two days before the Nov. 16 checks bounced, Wann advertised a gift card sale: $20 for every $100 purchased.
Salon closed before gift cards could be used
Wann said it was a good way to set up clients months in advance and to boost sales.
The gift cards weren’t usable until after Dec. 1, which was four days after the salon closed its doors.
Officer and Vaden Ottinger said it was just another lie to keep the salon afloat, so they offered clients who bought gift cards to take any product in the store they wanted.
Vaden Ottinger said another issue, though, was that there wasn’t enough product to sell because they weren’t able to restock products.
“We didn’t have the money and we knew that there was none, so we were just saying ‘you paid this amount of money for this gift card and you take this amount of product'” Vaden Ottinger said.
They said they also told clients to file a fraudulent charge with their credit card company to get a refund.
GEO stylists began to warn customers
Around that time, stylists were also starting to warn clients of the potential closing.
Employees said that some of them received an email from Wann on Nov. 21 about a private, closed-door meeting for those who received the email personally.
Employees shared it though, so everyone could attend.
Officer and Vaden Ottinger said that Wann walked through the door as if nothing was wrong, but then read a letter announcing that the last day for the salon was Nov. 23.
They said they have no idea if any of their informal paychecks had taxes taken out.
The Separation Notice that Wann emailed to employees was nearly blank.
It only stated “The company is ceasing operations due to insolvency and cannot afford any employee,” along with Wann’s signature, business address and phone number.
Employees said though that the property manager allowed them to work until the day before Thanksgiving.
They also said Wann never told many of the employees if they were getting paid for the week of work before the announcement.
One employee said she hasn’t gotten paid for three weeks’ worth of work.
Officer said that because their paychecks bounced on Nov. 16, the stylists either decided to, (or were allowed) to keep their entire earnings from their clients during the weeks of Nov. 18-22 and Nov. 25-27.
Wann plans to contact GEO gift card purchasers
Wann said he allowed the stylists to skip booth rent because of the stress that was going on with the possible closure.
Wann said he never wanted to close GEO Hair Lab, and he never meant to put any of the clients or employees in the bad situation.
He said that he plans on calling every client who purchased a gift card within the next few weeks to help them figure out what to do.
As of Monday, GEO Hair Lab never posted on social media or the website that it is closed.
Many of the employees said that they loved working at the salon and they used to like Wann as a person and a boss, but they want him to hold himself accountable for his actions.
CareCuts mission won’t be impacted
CareCuts, a non-profit organization that offers free hair cuts for those with financial restrictions, said the closing of GEO Hair Lab won’t impact it.
CareCuts used to offer free cuts in the GEO salon location every Sunday, and will have one last session this coming Sunday, but if need be, haircuts will take place at the CareCuts location on Williams Street, just behind GEO.