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COSTA Coffee has announced plans to cut 1,650 jobs following the coronavirus crisis.
The move would impact around 10% of the entire workforce employed in wholly-owned Costa stores but those in franchised shops are unaffected.
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Costa says sales have taken a hit after it was forced to shut the majority of its 2,700 shops in March 2020.
The coffee chain has now reopened around 2,400 branches, but claims there are still “high levels of uncertainty” about when profits will return to normal.
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Costa says trade has started to pick up thanks to a recent cut in VAT and the retailer taking part in the Eat Out to Help Out scheme.
But it claims the “difficult decision” to propose job cuts is necessary to protect the future of the business.
Job losses since June 2020
MANY firms have announced job cuts since June as a result of the coronavirus lockdown. These include:
- Shoe chain Aldo collapsed into administration with five stores permanently closed
- Victoria’s Secret plunged into administration, putting 800 jobs at risk
- Fashion chain Quiz put its shop business into administration in , putting 82 stores at risk
- British Gas owners cuts 5,000 jobs, over half of which will be in management
- Airbus announces 1,700 job losses. It expects cuts to be made by summer 2021
- TM Lewin says it will close all 66 of its UK shops, putting 600 jobs at risk
- Harveys Furniture goes into administration resulting in 240 immdiate job losses and puts another 1,000 at risk
- Upper Crust plans to make 5,000 out of its 9,000-strong workforce redundant
- EasyJet says it plans to close hubs at Stansted, Southend and Newcastle, putting 4,500 jobs at risk
- John Lewis is reported to be planning to cut jobs and permanently close department stores
- Harrods has said it is consulting on cutting 680 jobs
- Virgin Money, which owns Clydesdale and Yorkshire Bank, will cut 300 jobs
- Topshop owner Arcadia has announced plans to cut 500 office staff
- Royal Mail is expected to cut 2,000 jobs as a result of coronavirus
- BMW and Mini have announced they will axe 520 jobs at Birmingham, Oxford and Swindon plants
- Pret a Manger is cutting 2,800 jobs with 30 stores to close
The move comes a week after rival Pret A Manger revealed it was slashing 2,800 roles as part of a restructure.
Costa has started a consultation process with affected staff.
The company hasn’t revealed which roles it plans on cutting, but says it will try to find alternative roles for employees.
It wouldn’t confirm if it plans on closing stores when asked by The Sun.
We’ve asked if the job cuts are regional, or nationwide, and we’ll update this article when we know more.
What are my redundancy rights?
BEFORE making you unemployed, your employer should still carry out a fair redundancy process.
You are entitled to be consulted on the redundancy lay-off first and to receive a statutory redundancy payment, as long as you’ve been working somewhere for at least two years.
How much you’re entitled to depends on your age and length of service, although this is capped at 20 years. You’ll get:
- Half a week’s pay for each full year you were under 22,
- One week’s pay for each full year you were 22 or older, but under 41,
- One and half week’s pay for each full year you were 41 or older.
Sadly, you won’t be entitled to a payout if you’ve been working for your employer for fewer than two years.
There should be a period of collective consultation as well as time for individual ones if your employer wants to make 20 or more employees redundant within 90 days or each other.
You are also entitled to appeal the decision by claiming unfair dismissal within three months of being let go.
Costa employs 16,000 people across 1,600 wholly-owned UK stores, plus there are 10,500 employees working across 1,100 franchise stores.
Today’s announcement doesn’t impact members of staff who work in franchise stores – but we’re checking if franchise partners are able to make their own job cuts.
While stores were closed, all team members were put on furlough with their salaries topped up to 100% by Costa for 12 weeks.
Neil Lake, managing director for Costa Coffee UK and Ireland, said: “Today’s announcement to our store teams was an extremely difficult decision to make.
“Our baristas are the heart of the Costa business and I am truly sorry that many now face uncertainty following today’s news.
“We have had to make these difficult decisions to protect the business and ensure we safeguard as many jobs as possible for our 16,000 team members, whilst emerging stronger ready for future growth.”
Costa is just one in a long line of retailers to grapple with job cuts following the spread of Covid-19.
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Boots, John Lewis, M&S, and WH Smith have all confirmed mass redundancies.
Gatwick has also announced plans to cut 600 jobs – almost a quarter of workers due to coronavirus.
While Ryanair has said it plans to axe 3,250 jobs, while British Airways has warned it needs to cut 12,000 jobs.
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