The Sacramento Bee reports that Raley’s laid off 153 headquarters employees on Friday, just a week after it eliminated the jobs of five senior executives.
"This was the final step in a process that was necessary for us to compete in this new world," said CEO Michael Teel, noting that the retailer had become top-heavy. Teel said that planned expansion caused the company to build staffing levels, but that the combination of economic decline and toughened competition meant that tough decisions had to be made.
According to the story, “to comply with federal WARN Act guidelines that require notifications in advance of large job cuts, Raley's is placing the 153 workers on a fully paid leave of absence for 60 days. After that, they'll be eligible for severance payments of one week of pay for each year of service, with a 26-week cap.”
Employees were informed of the moves on Friday, and terminated staffers were allowed to gather their personal belongings and then leave the premises. The headquarters building was then closed at 1 pm “and all employees were given the rest of the day off. That was to give them time to absorb the changes at the company, the CEO said.”
"This was the final step in a process that was necessary for us to compete in this new world," said CEO Michael Teel, noting that the retailer had become top-heavy. Teel said that planned expansion caused the company to build staffing levels, but that the combination of economic decline and toughened competition meant that tough decisions had to be made.
According to the story, “to comply with federal WARN Act guidelines that require notifications in advance of large job cuts, Raley's is placing the 153 workers on a fully paid leave of absence for 60 days. After that, they'll be eligible for severance payments of one week of pay for each year of service, with a 26-week cap.”
Employees were informed of the moves on Friday, and terminated staffers were allowed to gather their personal belongings and then leave the premises. The headquarters building was then closed at 1 pm “and all employees were given the rest of the day off. That was to give them time to absorb the changes at the company, the CEO said.”
- KC's View:
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Maybe not the final step. It all depends on how compelling a store experience the company offers to consumers.
Raley’s may be able to be more competitive because of these changes, or it may just be setting itself up for the moment when it will accept a buyout offer from some bigger chain. There is a lot of betting out there that the latter is the more likely scenario...but it is not inevitable. It all depends on execution.
