Pure Beauty

Covid-19: John Lewis expected to follow Primark in rejecting government’s job retention bonus

By Becky Bargh | Published: 14-Jul-2020

The luxury retailer could be side stepping £14m of government funding if it rejects the offer

Department store chain John Lewis is expected to reject a cash injection from the government to bring back staff from furlough.

The UK government announced last week it would give a bonus of £1,000 per worker for companies that bring back staff from furlough and keep them employed until January.

John Lewis furloughed 14,000 employees after stores were forced to close due to the coronavirus pandemic, meaning it could be bypassing a grant of around £14m.

John Lewis has not yet made a public comment on whether it will accept the funding.

The news comes days after discount retailer Primark became the first large-scale consumer goods player to turn down the multi-million pound scheme.

Reports suggest the company could have been granted £30m of government funds approved by Chancellor Rishi Sunak, after furloughing 30,000 staff, but it told the BBC it has reinstated all of its employees and would not ask for the payment.

“The company removed its employees from government employment support schemes in the UK and Europe in line with the reopening of the majority of its stores,” said a spokesperson for Primark’s owner Associated British Foods.

Since the lockdown was enforced, the UK high street has suffered as a result of reduced footfall and John Lewis has been particularly affected.

Last week the luxury retailer earmarked eight stores to shut permanently, including its Birmingham Bullring shopping centre location.

As a result, staff jobs are on the line with more than 1,000 employees at risk of redundancy.

However, the company said it would offer staff a three month support programme with an outplacement specialist.

Health and beauty retailer Boots has also revealed plans to cut 7% of its workforce, around 4,000 jobs, as it battles with falling sales due to the pandemic.

According to the retailer’s owner, Walgreens Boots Alliance, sales were impacted by around US$700m, with the shortfall stemming almost entirely from its business outside of the US.

Boots is now said to be going through a consultation process ahead of a “significant” restructuring of its head office.

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