The Nashville-based firm said on Monday it would furlough employees and cut staff at its corporate headquarters, call centers and distribution centers in a bid to offset “the negative financial and operational impacts of COVID-19 and improve liquidity.”
In particular, the company, which temporarily closed nearly 1,500 stores in North America and the U.K. last month, said it has now whittled down its workforce by 90%. Furloughed employees will still receive health-care benefits from the company.
What’s more, Genesco said highly paid staffers would have their pay reduced on a graduated scale, with certain perks, such as 401(K) matches, also temporarily halted.
Genesco joins a growing list of retailers, from Saks Fifth Avenue and Neiman Marcus to Macy’s, who have opted to furlough a portion of their workforce in the U.S. The spread of the coronavirus has also forced many companies to tap into credit lines to maintain their cash flow.
The latest moves from Genesco follows its announcement last week that said its president and CEO, Mimi Vaughn, and other top managers who report to her wouldn’t earn a salary beyond benefits. Some senior managers saw their annual pay cut in half.
“These are extraordinary times for our company and the markets in which we operate. We have had to make very difficult decisions in response to this crisis, the ones relating to our passionate and outstanding people, who are the driving force behind our businesses, were the most difficult of them all,” Vaughn said in a statement. “Genesco has a long history of navigating through difficult times and the measures we are taking will protect the company and position us well to emerge from this crisis. We have exceptional brands and retail businesses with strong strategic positioning, and we look forward to welcoming our employees and customers back in our stores as soon as we can safely return.”
On a positive note, though, Genesco said that its U.K.-based Schuh business, as of April 3, had reopened its e-commerce operations.