Macy's Furloughs Workers, and Other Retail News Related to the COVID-19 Crisis
Total Retail is continuing its daily coverage of how retailers and brands are responding to the COVID-19 crisis and the impact it is having on their businesses. Here's the latest:
- Retailers are continuing to lay off and furlough workers due to the coronavirus uncertainty. Macy's announced this morning that the majority of employees for the Macy’s, Bloomingdales, and Bluemercury brands will go on furlough beginning this week. U.S. clothing rental firm Rent the Runway also said on Saturday it had laid off retail employees following temporary store closures amid the ongoing coronavirus outbreak. “Like many businesses affected by the COVID-19 pandemic, Rent the Runway has had to make some difficult decisions in the short term to thrive in the long term, which include temporary store closures and retail role eliminations,” a company spokeswoman said in an emailed statement to Reuters. Last week, Everlane laid off and furloughed more than 200 workers, including retail and those operating back-end functions, as it struggles to cope with the shutdown of its retail business over measures to reduce the spread of the coronavirus. (A group of Everlane customer experience workers who formed a union in December are crying foul, though, according to WWD. On Twitter, they said “every member of our union committee was fired.” ) Finally, Tailored Brands, Inc. last week announced that it will extend the temporary closure of its retail stores until at least May 4, as well as implement additional cost reductions, including furloughing all U.S. store employees as well as a significant portion of employees in its distribution network and offices.
- While regular paychecks continue to go out to employees, including those who work at the company’s temporarily shuttered retail stores, Tim Boyle, president and CEO of Columbia Sportswear Company, has cut his own pay to $10,000 a year, and at least 10 top executives took a voluntary 15 percent pay reduction, according to the The Oregonian/OregonLive. Columbia Sportswear closed its brick-and-mortar stores on March 16 in response to the coronavirus pandemic. On Friday, the company announced the closures would remain in effect for at least another two weeks.
- Tapestry, Inc. announced its Coach Foundation will commit $2 million to support New York City's Department of Small Business Services (SBS) Small Business Continuity Fund for businesses affected by COVID-19. In addition, Tapestry's charitable foundations will match gifts made by company employees in North America to support qualified charitable COVID-19 causes, up to $10,000 per employee under Tapestry’s matching gift program. The Coach Foundation will also make an additional contribution to an organization crowdsourced by employees in North America. Founded in 2008, the Coach Foundation brings the company's philanthropic initiatives to life. To date it has granted more than $50 million to nonprofit partners globally.
- U.S. mall owner Taubman is telling its retail tenants they must pay rent amid the coronavirus pandemic. In a memo dated March 25 (obtained by CNBC), the real estate investment trust said it still has its own obligations to meet — such as paying lenders on mortgages and paying for utilities. “The rental income that we receive from tenants is essential in order to meet these obligations,” The Taubman Co.said. “All tenants will be expected to meet their lease obligations." Taubman announced earlier this month that all of its properties will be closed through at least the end of March, except for two centers, which are open-air. The announcement by Taubman came a day after its larger rival, Simon, said it was shutting all of its malls and outlet centers temporarily to try to help halt the spread of COVID-19. “We are attempting to navigate through this situation in the best way we can, while being as flexible as we can with our tenants in light of our ongoing obligations,” a Taubman spokeswoman told CNBC.