Hanover Co-op deal with manager aims to bring stability after period of discord

HANOVER — The Hanover Co-op board and interim General Manager Paul Guidone on Friday ended a three-week impasse over terms of employment and averted his resignation, which was to take effect on Sept. 25.

The Co-op announced that Guidone — who took over as interim general manager March 8 just as the coronavirus pandemic was taking hold in the U.S. — will instead stay on the job as general manager long-term.

The agreement healed a rift that would have destabilized one of the Upper Valley’s deepest-rooted businesses at a time when customers are depending upon it the most.

Striking a tone of conciliation, Jessica Saturley-Hall, acting board president, said the directors were “very pleased” that Guidone was staying on, given his leadership during the pandemic.

“The grocery business also faced a number of new and novel challenges. Paul has successfully navigated us through the obstacles our organization has faced so far, and we believe he is the right person to manage the business going forward,” she said in a statement.

Saying he was “very proud” of how the Co-op has navigated the pandemic, Guidone in a statement described the past six months as “a very satisfying and humbling experience.”

“I look forward to continuing to help the organization confront and overcome the challenges posed by a pandemic-affected world,” he said.

The announcement quickly followed the board’s approval on Thursday night of a “letter of intent” with Guidone that codifies the relationship between the general manager and the board and that meets many of the demands that Guidone had put to the board more than three weeks ago. When the board balked then, he resigned.

The 11 “terms” outlined in the document parallel many of Guidone’s 13 demands and appear to address the major bones of contention — namely meddling and a profusion of communications from individual board members directly to Guidone — that riled his relations with the board.

Among the bullet points:

■A board president who “understand(s) and respects the difference between board fiduciary oversight and getting involved in day to day operations.”

■Board members “prioritize written communication” over phone calls with the general manager “to avoid misunderstandings and repeat conversations.”

■The general manager will “reply to any and all” requests to the board president “in writing.”

■Requests for Co-op employees to support board-related work must be submitted in writing through the board president to the general manager, “no exceptions.”

■Except for a “true emergency,” Guidone’s “hours of availability” to the board will be from 8 a.m. to 5 p.m., Monday- Friday, either by email or phone.

■A three-year employment agreement with an option to renew.

The 10-member board voted, 9-1, in favor of adopting the terms of the letter.

Only board member Nick Clark voted against it. Clark, who is also chair of the Thetford Selectboard and at a board meeting earlier in the month had pushed the board to release publicly Guidone’s list of demands, said, “I think this process has been backwards.”

Clark, who acknowledged he was the “sole dissenting voice,” criticized his fellow board members for holding “several informational meetings that haven’t been posted to members,” calling the process “very rushed” and that “membership in general isn’t aware of that full discussion.”

Although assumed by many to be a nonprofit, the Co-op operates four grocery stores, two auto service centers and a commercial kitchen, and with $77 million in annual revenues, 370 employees and some 20,00 members, it represents one of the Upper Valley’s largest for-profit and public-facing businesses.

The past few weeks have seen Guidone submit his resignation with a month’s notice; the president of the board abruptly resign in the middle of a Zoom meeting; a second board member resign; and Guidone issuing a list of demands that the board address before he would consider rescinding his resignation.

The back-and-forth between the board and general manager became a distraction among employees. Many felt Guidone had proved he had the chops for the job over the past six months.

“People have been extremely upset about what is happening,” said Ayla Liden, who works on the customer service desk at the Co-op’s Hanover store and spoke to a reporter prior to the announcement of the agreement.

She was one of several employees who had written to the board imploring them not to let Guidone go.

“Employees have felt safe, guided and structured” under Guidone’s management, she said, which has coincided almost to the day with the onset of the coronavirus pandemic.

The turmoil began on Aug. 26 when Co-op board president Allene Swienckowski, frustrated over the board subjecting Guidone to a “full press” formal job interview despite his success as interim GM, quit the board.

Then on Aug. 28, Victoria Fullerton, who had been on the Co-op board five years and had been chair of the board’s diversity, equity and inclusion committee, also resigned, citing personal reasons.

A week later, as Swienckowski had foreshadowed in an email to her fellow board members in late August, the board disclosed that Guidone had turned down the board’s initial offer to become the Co-op’s general manager permanently and tendered his resignation, effective Sept. 25.

The details of the impasse broke out into the open when Guidone and the board agreed mutually to release Guidone’s list of 13 demands in order to allow Co-op members and employees the opportunity to review them and offer feedback to the board.

Guidone’s “terms and conditions” were a stunning rebuke to the current board and suggested that the former career wealth management executive — who moved to the Upper Valley to retire before he became involved with the Co-op — had been chafing under the board’s oversight during the past half year.

While the demands might strike some as more akin to those accorded a Fortune 500 executive than to a fleece vest-wearing general manager of a local co-op, several former board members urged the board to reach a deal, arguing that losing Guidone would be a setback for the Co-op at a time — a global health crisis and stressed supply chains — when it can ill afford to launch the search for replacement.

By one measure — revenue — the Co-op has performed exceptionally well during the pandemic, according to the general manager’s updates to the board during its regular monthly meetings. (The grocery sector nationally has been one of the few bright spots in the economy during the pandemic, as households stocked up on basics and stimulus money propped up consumer spending.)

For the seven months through July, Co-op sales reached $47.5 million, $3.7 million ahead of what the Co-op had budgeted for the period. The “basket size” — the purchase volume per customer transaction — soared 43% for the period, adding an average of $16.66 per transaction.

Of note, the deli counter has dished out 400 more pounds of coleslaw and 231 pounds more pounds of “macaroni salad” over the first six months of 2020 than it did in 2019.

Meanwhile, the Co-op has added 648 new members so far this year, including 160 alone in July, 100 more than it added over the first seven months of 2019.

The one pronounced downturn has been — again reflecting national trends — in gas sales. With many people working from home, the Co-op has pumped 15,000 fewer gallons of gas this year, a decline compounded by an average price drop of 60 cents per gallon from last year.

This has all occurred during a time when Guidone oversaw the introduction of curbside pickup and new workplace health protocols inside the stores. He also championed — and unsurprisingly won loyalty for — $300 employee bonuses and weekend overtime pay for employees during the crisis.

Linden, the customer service desk worker, said that employees had been so upset over the board’s treatment of Guidone that some even talked about a “sit-down” or “walk-out” in protest.

She said one of Guidone’s strengths has been communication — during the first couple months of the pandemic he sent a companywide email to all staff every morning.

“Ed (Fox, the previous general manager) was more community-focused and board-focused. But Paul is focused more on the stores and running things smoothly,” she said.

Guidone, a Hanover resident and chartered financial analyst whose career in money management included positions at banking giants HSBC and Citigroup and a New Jersey hedge fund, joined the Co-op as CFO in 2016 and later was tapped by Fox as a “strategic adviser.” In February, a week after Fox announced he was stepping down, the board unanimously asked Guidone to become interim general manager.

Tony Roisman, a former board member and Co-op president, sounded an alarm during the Sept. 8 board meeting over the risks the Co-op faced without a settled leader in the current environment.

“You’re talking about months during which the Co-op will be adrift at a time,” he said, when it requires “clear, well-defined leadership,” especially as it embarks on a $6 million renovation of its flagship Lebanon store.

“I can only say when I went to the Co-op to shop, which I do at least once a week, I never found that the COVID-19 pandemic had seriously impacted the things I wanted to buy. The staff, and therefore Paul, did a remarkable job of keeping the products on the shelves,” Roisman, who has been a prominent environmental lawyer and lives in Weathersfield, said in a subsequent interview.

Swienckowski, a former Los Angeles banker who is chairwoman of the Hartford Committee on Racial Equity and Inclusion and said she has “nothing but praise” for Guidone, said his 13 demands were reasonable given the context of his job performance.

“The man worked,” she said. “He basically told his team he was available 24/7, and he meant it.”

Contact John Lippman at jlippman@vnews.com.