Best Buy furloughs 51,000 workers as coronavirus weighs on business
The temporarily furloughed employees include 'nearly all part-time workers'
Best Buy is adapting its business model during coronavirus, which could become the ‘new normal’ as we begin the reopen the country. FOX Business’ Lauren Simonetti with more.
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Best Buy announced Wednesday the tech chain will furlough roughly 51,000 hourly and part-time store employees nationwide beginning Sunday as the company grapples with the business impact of the coronavirus pandemic.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| BBY | BEST BUY CO. INC. | 89.00 | -3.66 | -3.95% |
In addition to furloughing the workers, who include "nearly all part-time employees," an unspecified amount of corporate staff members have volunteered to work reduced hours and, in turn, take pay cuts, while others have volunteered themselves for the temporary furloughs, Best Buy announced Wednesday.
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"We are taking the steps necessary to resume providing our customers in-home services in the near future, keeping in mind our overriding priority on the safety of our employees and customers. We are also preparing to re-open stores to customers as soon as it is safe to do so, with timing likely to vary at state and local levels," CEO Corie Barry said in a statement. "In the meantime, as you would expect, we are focused on making the difficult decisions necessary to ensure that at the end of this crisis Best Buy remains a strong, vibrant company.”
Best Buy will continue to provide the furloughed employees with health benefits for at least three months at no cost. It has also created a $10 million employee assistance fund for all part- and full-time workers who have been with the company at least a year and who have been financially impacted by COVID-19.
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Meanwhile, approximately 82 percent of Best Buy's full-time store and field workers are still on the payroll.
The company also announced Barry will take a pay cut of 50 percent of her base salary, while Best Buy's board of directors will forego half of their cash retainer fees until at least Sept. 1.
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Other company executives will also take pay cuts of 20 percent of their base salaries through at least Sept. 1, Best Buy said.
The retailer previously announced on March 22 it would be moving to a "curbside service model" and suspending at-home service.
“We have retained approximately 70% of our sales compared to last year since moving to our enhanced curbside service model," Barry said. “This is a testament to the strength of our multi-channel capabilities – as our Domestic online sales are up over 250% and approximately 50% of these sales are from customers choosing to pick up their products at our stores since moving to our curbside service model.”