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Mothercare puts 500 jobs at risk

Mothercare customer service advisors are to be offered limited hours or face redundancy in a restructuring move which could see 500 staff being shed from the company.

The maternity retailer is to reduce the number of hours available to staff working more than 24 hours a week, with those who do not accept the reduced hours potentially being made redundant.

In a statement Mothercare said: “Mothercare is valued by its customers for high levels of service, expertise and advice. As an important part of its continued commitment to service, and in response to customer feedback, Mothercare is looking to increase the proportion of colleagues serving customers at our busiest times.

“As well as creating new jobs, this step will lead to changes in working practices for a number of our UK store colleagues and we are consulting with those affected”.

The move comes after a series of disappointing results prompted a long term turnaround plan at Mothercare following the departure of former chief executive Simon Calver in February.

In its latest results, for the year to March 2013, Mothercare reported a 3.6% fall in UK like-for-like sales. Overall group profits rose by £8.3m, but this was driven largely by Mothercare’s international performance. Its UK profits were down by £21.7m for the period, compared with a £42m rise overseas.

Commenting on the move, Julie Palmer, partner at insolvency and turnaround specialist Begbies Traynor said: “After reporting crushing losses in its most recent results, Mothercare’s latest restructuring plans are just too little, too late for the struggling retailer.

“By forcing loyal staff to accept part-time hour contracts, the group will only weaken its customer service offering still further, driving more consumers towards cheaper, more convenient alternatives such as online retailers and the supermarkets”.

Yesterday Morrisons announced a significant restructuring programme which could see up to 2,600 staff members being made redundant.

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