Debenhams to axe 2,500 jobs in bid to cut costs

Debenhams, whose Irish arm was placed into liquidation in spring, is to axe 2,500 jobs across its stores and warehouses in the UK as the retailer looks to slash costs after sales were impacted by the coronavirus lockdown.

The department store business is scrapping the roles of sales manager, visual merchandise manager and selling support manager as part of a management restructuring process.

The move, which was first reported by RetailWeek, comes four months after Debenhams collapsed into administration.

Debenhams said it has no plans to shut more stores as part of the restructure.

<figcaption class='imgFCap'>Debenhams fell into administration in April in a bid to protect itself from creditors (Nick Ansell/PA)</figcaption>
Debenhams fell into administration in April in a bid to protect itself from creditors (Nick Ansell/PA)

Hundreds of jobs have already been lost at the retailer since the start of lockdown after it permanently shut 18 stores.

In April, it hired administrators from FRP Advisory in a protective measure against creditors demanding their money.

In May, the company said it would cut hundreds of jobs at its head office to help secure the company’s finances

A Debenhams spokesman said: “We have successfully reopened 124 stores, post-lockdown, and these are currently trading ahead of management expectations.

“At the same time, the trading environment is clearly a long way from returning to normal and we have to ensure our store costs are aligned with realistic expectations.

“Those colleagues affected by redundancy have been informed and we are very grateful to them for their service and commitment to Debenhams.

“Such difficult decisions are being taken by many retailers right now, and we will continue to take all necessary steps to give Debenhams every chance of a viable future.”

Former Debenhams workers in Ireland have staged a series of protests in a dispute over redundancy terms.

The former staff claim the package offered to them when the Irish arm of Debenhams was placed into liquidation this spring was unfair.

They are set to receive statutory redundancy payouts of two weeks of salary per year of service. The workers are demanding four weeks’ pay per service year.

They are also calling on the Government to waive monies owed to it through the liquidation process so they can be used to boost the redundancy packages.

Liquidator KPMG is set to use proceeds of the liquidation of the Irish business’s assets to pay off key creditors, such as the Revenue Commissioners and other State bodies.

The Irish arm of Debenhams, which operated 11 stores in the country, was placed into liquidation in April.