Restructuring events
European Restructuring Monitor (ERM)
The restructuring events database contains factsheets with data on large-scale restructuring events reported in the principal national media and company websites in each EU Member State. This database was created in 2002.
On 24 October 2014, German retail chain Karstadt announced to shut down six stores by mid-2015 which will make 350 jobs redundant. Furthermore, the management intends to cut 2,000 jobs on sale floors and in the administration department. Every fourth job will be made redundant at the company's administrative centre in Essen.
Trade unions and works council criticised these job reduction plans and referred to it as a hasty decision without an exploration of the true reasons for the company's weak position.
Currently Karstadt employs around 17,000 people. The company filed for bankruptcy in 2009. Investor and new owner René Benko wants to implement a new strategy and invest again in 2017 if restructuring will have been successful then. Currently, more than 20 of 83 stores run high losses.
Karstadt already previously announced to cut 2,000 jobs by the end of 2014 (see FS2013). After filing for bankruptcy in 2009, the company dismissed around 1,200 people (see FS2009).
UPDATE 28/02/2015: As reported by FAZ and many German newspapers on 23 February 2015, management and works council have recently agreed to only cut 1,000 rather than 2,000 full-time positions. Furthermore, 400 part-time jobs will be made redundant. Staff will be given notice starting in March 2015. The reduction will reduce personnel cost by €60 million and will be implemented by partial retirement, fluctuation and severance payments. Moreover, a transfer agency is going to be set up for dismissed employees.
Eurofound (2014), Karstadt, Internal restructuring in Germany, factsheet number 77750, European Restructuring Monitor. Dublin, https://dev.eurofound.europa.eu/restructuring-events/detail/77750.
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