Arcadia Group has written to employees on fixed-term contracts to inform them that it will be ending their agreements early.
In a letter seen by Drapers, the company said: “The current global pandemic is a crisis affecting all UK businesses and the retail industry has already been significantly impacted by high levels of consumer uncertainty.”
As a result, the group, which is owned by Sir Philip Green, said it has made the decision to end fixed-term employment contracts early. The company said it will issue staff with the contractually required four weeks’ notice.
“It is with regret that we have had to make the decision to end your fixed-term contract early and issue you with your contractual 4 weeks’ notice”, the letter added.
Drapers understands the contract termination covers teams across the group, including those in marketing, creative, store planning and visual merchandising.
Staff were informed before 20 March, when chancellor Rishi Sunak announced government business grants to cover 80% of wages of employees unable to work as a result of the coronavirus epidemic, but kept on by their employer.
One Arcadia Group employee on a fixed-term contract told Drapers: “They have made the decision to terminate my employment. It was very upsetting news. If coronavirus hadn’t happened, I know 100% I would still have my job. I feel it was a very drastic decision, I understand it is worrying times but why did they not wait to see what the government announced this week?”
Another Arcadia employee said: “It is very upsetting and frustrating to be the first ones to be ‘out the door’ before they’d even seen what the government where going to do. They are battening down the hatches before they have even seen what is available to them.”
It is also understood that store employees, who now cannot work after the government lockdown on non-essential stores this week, have been furloughed and will qualify for government support.
Last week a spokesman for the fashion retail group, which owns chains including Topshop, Topman, Miss Selfridge, Dorothy Perkins, Evans and Burton, said store staff ”have not been made redundant”, but the business said it would continue to “review the situation”.
The company said: “The health and wellbeing of our employees, customers and communities remains our highest priority and we continue to closely follow the government guidelines.
“In line with many other retailers the group has made the difficult decision to close until further notice all of our stores from 4pm this afternoon [20 March]. All store staff remain employees during this time and will be paid their normal pay for March plus any outstanding overtime payments, after which we will review this situation and will be keeping our store teams updated.
“In the meantime we will be focusing on our digital and social platforms to keep our customers engaged during this challenging time.”