Primark has revealed further measures to tackle the impact of the COVID-19 pandemic, including putting all store employees on furlough.
The budget fashion chain’s entire store estate has been closed since March 22, leaving the business with billions of pounds worth of unsold goods. According to the firm, the closures are costing it £650 million per month in lost sales.
In addition to the furlough, the retailer has announced a temporary 20% pay cut for senior executives. The remainder of employees across its HQ and office functions will also face a 10% reduction in pay for the next 12 weeks.
Further, the leadership team has committed to temporarily reducing their salaries by 30% and CEO Paul Marchant will take a 50% reduction.
Executive directors will not receive bonuses for the current financial year.
The company, which has more than 30,000 store employees in the UK, said staff will be paid their full wages until April 5.
With all stores closed and no e-commerce operations, Primark is at a disadvantage in fighting the impact of the coronavirus. The affordable fashion brand has had to cancel huge suppliers’ orders and is talking with landlords about not paying rent during the lockdown.
Primark has also frozen recruitment and is working on reducing its operating expenditure to preserve its cash balance. a