Michigan school districts scramble for substitute teachers after company shuts down

PESG abruptly shuts down, ending contract with districts


DETROIT – Some school districts in Michigan are working to fill substitute teacher positions after the company that provides the employees abruptly shut down and ended its contract with the districts. 

Two districts in southeastern Michigan -- Dearborn Public Schools and the Clintondale School District -- released statements ahead of classes Tuesday saying they were just made aware of their contract with Professional Education Services Group (PESG) being pulled. 

"The administrative team is working closely with our principals to put together an emergency plan so there will be substitutes available for Tuesday," the statement from Dearborn Public Schools reads. "There will most likely be delays in getting some substitutes to buildings on Tuesday morning. Please be patient and understand that we have a plan in place and will be utilizing all of our resources in order to ensure coverage at our schools."

The Dearborn district serves more than 18,000 students. Clintondale serves students in Macomb County. 

“We are aware last night that PESG has pulled their Michigan contract and we are working feverishly with our employees and subs to operate properly," reads a statement from Clintondale. 

It wasn't immediately clear how many Metro Detroit schools districts are affected by PESG's closure.

PESG sent this letter to sub teachers Monday afternoon, telling them to go to their local school districts and get work directly through them because they are no longer employed by PESG: 

To All Professional Educational Services Group Employees in Michigan:

We regret to inform you that Professional Educational Services Group, LLC is stopping all operations in Michigan effective immediately. This means that your employment—and the employment of all Professional Educational Services Group employees in Michigan—is terminated on October 22, 2018.

You will no longer be able to obtain substitute teaching jobs or any other work from Professional Educational Services Group going forward. We believe the shut-down will be permanent. Under the circumstances, therefore, we strongly encourage you to contact your local school districts to sign up for and obtain work directly from the districts.

We are notifying the school districts of Professional Educational Services Group’s inability to continue operations today, at the same time we’re communicating this bad news to you. This naturally will cause disruption, which we are working to minimize. We estimate that this affects between 1,500 and 2,000 substitute schoolteachers throughout the state this week and we have had as many as 15,000 individuals registered with Professional Educational Services Group this year at about 110-120 districts—all are affected directly or indirectly by this shut-down.

We are also permanently closing our Michigan headquarters in Caledonia and Burton location terminating the entire office staff at both locations. These drastic measures are unavoidable and include many circumstances outside of our immediate control. Nevertheless, you have my personal commitment that we will wind down operations in an orderly manner and take all reasonable efforts to minimize the inevitable disruptions on you, your families, the various school districts, and ultimately the students we served in our communities.  

We have been actively seeking capital to keep operations going and have been in good faith negotiations with a competitor to sell the business in a manner that would have prevented your terminations and allowed Professional Educational Services Group to continue operations. The urgency of the shutdown was exacerbated, however, when those negotiations broke down over the weekend due to unforeseen developments outside of our control. Without operating funds to stay open, therefore, the company is now forced to close immediately. Under the circumstances, we believed our only serious option was to notify you as soon as possible.

In the short term, as stated above, you will receive no new jobs or new placements from Professional Educational Services Group. If you worked placements in the days leading up to this shut-down, then Professional Educational Services Group or the school district will send your last paycheck in the normal course of business at the next regularly-scheduled pay cycle or as soon as possible thereafter. We ask that you refrain from making any changes this week to your normal direct deposit on file with the company to prevent further delays or disruptions in pay because our office staff is also being terminated. If you must make changes, then please use Professional Educational Services Group’s dedicated email to contact us about the changes. We will work through these changes manually with the assistance of our payroll provider and counsel as quickly as possible. The e-mail is mieeinfo@contractsubs.com.

We also recommend that you contact the individual school districts to obtain work directly from the districts. Each district has a protocol in place for filling immediate needs. Although we regret this anticipated strain on the districts, ultimately, they are in a position to best communicate what their needs are day-to-day.

If you must speak with a Professional Educational Services Group representative, please use our dedicated call line for employees. We will triage calls and get back to you, when appropriate, as quickly as possible. The number is 616-891-0509.

If you have made employee contributions into the Professional Educational Services Group 401(k) plan, then please be advised that your funds are held in trust and safe from Professional Educational Services Group’s creditors.  We encourage you to speak with a financial advisor or tax professional to consider your options including but not limited to rolling over your 401(k) account balance into another qualified plan or setting up an individual retirement account (IRA). A copy of your Summary Plan Description (SPD) can be obtained from Professional Educational Services Group’s third party administrator Lincoln Financial.

Depending on how many hours you worked for Professional Educational Services Group in the prior months, you may also be eligible for unemployment insurance or other state-based assistance. Each determination is on a case-by-case basis and more information can be obtained at https://www.michigan.gov/uia/.

We founded this company 13 years ago to help provide good jobs in the community while helping our many school districts meet critical needs for our young people in real time. This is a rather unceremonious end to that effort. But, while we wish things could have turned out better, before we sign off, we wish to personally thank you for your service to Professional Educational Services Group and the dedication you showed to the many students you helped serve throughout the State of Michigan. We wish you all well in all your future endeavors and apologize for any disruption or stress we may have caused you.

Very truly yours,

Henry Bledsoe
President/ CEO
Professional Educational Services Group, LLC
a Michigan limited liability company

About the Authors: