CHAMPAIGN — Philip Wall was dismayed to learn last week that he and his 30 or so colleagues at Publication Services were losing their jobs.

But he was really irritated to discover this week he wouldn't be paid for his last two weeks of work.

On Friday, Publication Services posted a notice to employees on its door, stating: "All of the assets of Publication Services Inc. were seized by Busey Bank and applied to the loan due them, so there is no money to fund payroll."

The notice from Ann Stout, the company's president, continued: "I am sorry — we made an enormous effort to avoid this, but the bank has made its decision."

Wall said the information really bothered him.

"I'm unhappy with Busey Bank's behavior. To let this happen is a disaster," said Wall, who worked for Publication Services for 15 years, first in typesetting and later in information technology.

When asked to respond, Busey Bank spokeswoman Amy Randolph said the bank has a policy of not commenting on customers' legal matters.

Ann Stout said Publication Services is not commenting on developments, on the advice of legal counsel. Her husband, Bill, the company's CEO, also declined to talk publicly at this point.

Wall said when the Stouts told employees on April 29 that it was their last day of work, he understood he would get his final paycheck Friday. But he learned Thursday there would be no payday.

Wall had expected a check for about $600, after deductions.

"It doesn't sound like a lot," he said. But he needs the money to help cover rent, health insurance and credit card expenses.

Adding to the crunch: Most employees hadn't been getting full-time hours the last several months, Wall said.

Publication Services had provided the publishing industry with services such as copy editing, proofreading, translating, text design, cover design, art preparation and index preparation. It had been in Champaign-Urbana for 35 years, the last 23 years at 1802 S. Duncan Road, C. Some of its employees had worked there for more than 25 years.

In 1991, Publication Services employed 140. But the company's prospects clouded — and its employment shrank — as publishers turned to overseas vendors to cut costs.

Recognizing those trends, the company struck a partnership in 2006 with a firm from India — Cyber Media Services. Cyber Media took a 49 percent stake in Publication Services and agreed to supply it with certain services, such as typesetting and graphics.

But according to several Publication Services employees, that partnership was fraught with problems. In some instances, they said, Cyber Media did not keep up with the workload and insisted on hiring its own vendors to handle it.

Occasionally, that resulted in substandard work, Wall said, "and that really hurt us."

Publication Services lost major clients as a result, employees said.

Bill Stout, who retained a 51 percent interest in the company, stepped in last fall and installed his wife, Ann, and stepson, Jeff Ashton, as overseers.

Several employees interviewed by The News-Gazette called it a positive transition. They said the attitude was more upbeat, the workplace was calmer and weekly meetings helped keep employees up to date on developments.

"The owners, Ann and Bill, are very nice people who put in their own money to keep it going," Wall said, commending their efforts.

But at the April 29 meeting, the Stouts told employees the company did not have enough sales to keep it afloat, Wall said.

Megan Washburn, the production supervisor for Publication Services, recounted what employees were told at that meeting.

"We were told ... that due to the financial difficulties, the company would be closing immediately and that they would be contacting Busey Bank, their primary creditor, immediately. We packed up our stuff and left," she said.

Washburn said employees were told they would get their final paychecks the following Friday — the regularly scheduled payday — but would not receive vacation pay they were due.

"We were also informed that our insurance coverage would end on April 30," she said.

Washburn said the company has been in "dire financial straits for well over a year" and "all employees had been working at substantially reduced hours for many months."

In addition to having 30 in-house employees, Publication Services said on its website it had more than 100 freelance editors and writers.

Washburn said Publication Services is "almost 12 months behind paying their freelancers and their vendors."

Some employees blamed the company's long-term problems on the rise of desktop publishing, which resulted in the company's services not being "valued like they once were."

"Publishers expected it could be done cheaply overseas, even though the quality was not as good," Wall said.

Wall cited the transition to e-books as an example, saying the quality of many of them is "awful" because they don't get proper editing and proofing.

"Overall, the modern world has rendered us obsolescent," he said.

As for the company not meeting its final payroll, Wall places much of the blame on the bank.

"Ann and Bill are good people who did their very best to keep the place open," he said. "I see Busey Bank as the villain here."