LOS ANGELES - J.C. Penny Company, Inc. announced it will temporarily furlough the majority of its hourly and corporate employees as the company extends closures of its stores and business offices during the COVID-19 pandemic.
The company announced it will temporarily furlough the majority of its hourly and corporate employees as the company extends closures of its stores and business offices during the COVID-19 pandemic.
The layoffs for hourly employees will begin April 2, while a majority of the company’s corporate workforce will be temporarily let go on April 5.
“These are difficult days all across the country and the globe. At JCPenney, we are making tough, prudent decisions to protect both the safety of our associates and the future of our Company,” said Jill Soltau, chief executive officer of JCPenney.
The company said in a statement that it would cover 100 percent of employee-paid premiums and offer full health benefits to all furloughed associates currently enrolled in the JCPenney benefits program.
Parking lots were empty in front of a JC Penney retail store at Southland Mall in Hayward, California during a shelter in place or lockdown order as a result of the COVID-19 coronavirus, March 17, 2020. (Photo by Smith Collection/Gado/Getty Images)
“Our thoughts are with our valued associates and their families who are all being affected as we face this troubling time together. This is a true public health crisis, so we are maintaining health benefits and paying premiums for associates,” Soltau said.
While social distancing has been the best weapon against the spread of the coronavirus, mandatory closures of non-essential businesses have devestated the economy leaving people jobless overnight.
Along with J.C. Penney, Macy’s also said it will stop paying tens of thousands of employees who were thrown out of work when the chain closed its stores in response to collapsing sales during the pandemic.
The majority of its 130,000 employees, including stock people and sales clerks, will still collect health benefits, but the company said that it is transitioning to an “absolute minimum workforce” needed to maintain basic operations. Macy’s has lost the bulk of its sales due to the temporarily closing of all 500 of its stores starting March 18.
The move is perhaps the most dramatic sign that even big name retailers are seeing their business evaporate and that the $2 trillion rescue package passed by Congress and signed by President Donald Trump last week may have come too late for some.
Nordstrom said last week it was furloughing a portion of its corporate staff. And shoe company Designer Brands Inc., which operates DSW Designer Shoe Warehouse, furloughed 80% of its workers, effective this past weekend. Analysts expect more furloughs to come as retailers won’t be able to pay their employees as cash reserves run lower.
The Associated Press contributed to this report.