Yoga Center of Minneapolis abruptly closes, withholds teachers’ paychecks

Another small business bites the dust after a desperate struggle to hold on.

Another small business bites the dust after a desperate struggle to hold on. Richard Tsong-Taatarii, Star Tribune

The Yoga Center of Minneapolis' last location in St. Louis Park suddenly went out of business on February 21 after a long financial struggle.

In December its North Loop location closed after an unsuccessful foray into selling yoga apparel, and owner Neil Reimer filed for bankruptcy. The problems weren't totally unknown to staff and students. Reimer held a meeting with teachers about a year ago when he went into Chapter 11 reorganization, assuring them that he could pull through.

But teachers say they weren't given a head's up when Reimer eventually filed for Chapter 7 liquidation. His decision to close the Yoga Center on payday sent instructors and students home, catching them unawares.

Pamela Smith, a student for more than 10 years, says the closure has left a hole in her heart. Knowing that teachers are paid just $6 a head out of the $20 admission, and never receive raises, she worries how instructors she's come to love will make ends meet. 

One teacher, who asked to remain anonymous, said many coworkers spent that Wednesday morning calling the studio, asking why there was no money in their accounts. They were expecting three weeks worth of pay, but were told that the Yoga Center couldn't make payroll and that students who had prepaid for upcoming training wouldn't be reimbursed. 

"We had zero notice to prepare for the loss," said the teacher, who estimated that each staff member was owed about $1,000.

Another instructor, 71-year-old Susan Meyer, said the business was like a family. When Reimer assured everybody that things would be fine, teachers had faith he was right.

The morning of February 21, Meyer taught a class at 8 a.m. By the time she finished, Reimer was in a meeting with his attorney, and she had a feeling that they were finally going down. Her fears were soon confirmed. She was told to clear out her personal effects, and informed she wouldn't be paid.
"We personally never got a thanks for nothing. We never got anything from [Reimer] apologizing for blindsiding us like that."

The lack of transparency was what really stung, Meyer says. In addition to her Social Security benefits, her Yoga Center money was what she used to pay the bills. Now she's hustling to get another job with 30 other teachers competing for work. She says those who worked for the center were kind and compassionate people who would have understood if Reimer had just given them a fair warning.

For his part, Reimer was contrite as he accepted all blame for the center's failure. He says he lost $1 million on the business, borrowed money from family and friends, declined a salary for years, and worked up to the last minute to try and make payroll, thinking he could find a way to stay afloat.

It was no secret that the center was struggling, he says, even though people weren't aware of just how bad things had gotten. He didn't know how to tell staff in advance that there was no money left to pay them, and he didn't want them to work another minute without compensation.

"I probably could have handled it better at the last minute," Reimer says. "I just failed on an epic scale. I've been ruined by it, and I've taken some good people down with me. It bothers me. It bothers me a hell of a lot, and I know that doesn't pay anybody's bills."

Some teachers are continuing workshops in their own homes, and some students have set up a GoFundMe account for former instructor Colleen Elwood.