Primark Declines $38M From British Government After Bringing Back Furloughed Workers

Primark has rejected tens of millions of pounds from the British government.

The department store announced over the weekend that it would not take advantage of the country’s funding scheme, which would’ve provided it 30 million pounds, or nearly $38 million at current exchange, for bringing back its furloughed workers.

“I can confirm that Primark does not intend to take advantage of support under the Job Retention Bonus announced by the Chancellor this week,” a spokesperson told multiple media outlets. “The company removed its employees from government employment support schemes in the United Kingdom and Europe in line with the reopening of the majority of its stores. The company believes it should not be necessary therefore to apply for payment under the bonus scheme on current circumstances.”

Doling out the bonuses would cost the government up to 9 billion pounds, or about $11.3 billion, if employers rehire all nine million people in the country who have been on furlough. (It was announced on Wednesday as part of the government’s relief program and applies retroactively.)

On March 24, Prime Minister Boris Johnson placed the U.K. on lockdown, ordering the temporary shuttering of all non-essential shops. Primark shuttered its entire brick-and-mortar fleet that month, when the coronavirus pandemic took hold in Europe. The outbreak has cost the company approximately 650 million pounds, or more than $821 million, in revenues a month.

Last month, the chain began reopening stores, including its units in Britain, where 30,000 employees were temporarily laid off. It has resumed business at all but eight of its 375 locations as of early July.

The U.K. government has issued directives dictating social distancing of two meters between individuals. Many retailers have said they would limit the number of shoppers allowed in stores at one time, as well as offer services including private personal chauffeurs, curbside pickup with contactless payment and private appointments both inside and outside regular opening hours.

According to a report from market research and analytics firm Global Data, about one-fifth of the U.K.’s fashion spend could be wiped out amid the COVID-19 health crisis. It predicted that apparel and footwear sales will drop by 11.1 billion pounds, or $14 billion, this year.

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