Neiman Marcus to Furlough Employees and Extend Closures

(Bloomberg) -- Neiman Marcus Group Inc., which closed all of its stores this month in response to the coronavirus pandemic, is extending the closures and will furlough a majority of its around 14,000 workers in the coming weeks.

The luxury retailer’s Neiman Marcus, Bergdorf Goodman and Last Call stores will stay shut at least until April 30, according to a statement sent to Bloomberg. A “large portion” of the organization “will either be put on furlough or take temporary salary reductions,” Chief Executive Officer Geoffroy van Raemdonck said.

The decision will go into affect on April 5 and last through April 30, with the potential for an extension, according to the company. Neiman employs around 14,000 emplyees, a large portion of which will either be put on furlough or take temporary salary reductions.

Like other retailers, Neiman is bracing for a potential slump tied to the virus outbreak. The company continues to serve its customers through online channels.

“We have already taken a number of actions to protect our business, but we’re now required to take employment-related actions,” van Raemdonck said in the statement. He will waive 100% of his own salary to support the business, along with other direct reports who will not get a “significant amount” of their own salary during the furloughs, he said.

The Dallas-based company has struggled to find its footing as shopper traffic to malls and department stores declines. It’s spending to retool so it can meet changing consumer tastes, while also carrying a costly debt load.

Macy’s Inc. on Monday disclosed plans to start furloughing the majority of its workers on April 1. The department store chain said the move would affect the majority of its 130,000 employees. It’s keeping a minimum staff to run digital operations and maintain its distribution and call centers. Chief Executive Officer Jeff Gennette will forego cash payment for the time.

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