J. C. Penney Company is reducing its workforce on the heels of downsizing its store portfolio as it looks to emerge from bankruptcy.
In connection with an “organizational realignment,” the department store retailer on Wednesday said it will reduce its workforce by approximately 1,000 corporate, field management and international positions.
The announcement comes as J.C. Penney has started liquidation sales at select locations. The company on Wednesday said about 152 store closures are now expected following a “comprehensive evaluation of store performance and strategic fit for the company. But it also said its negotiations with landlords continue. J.C. Penney filed for bankruptcy on May 15 with about 860 stores and some 90,000 full-time and part-time employees.
The company said the organizational restructuring will create a smaller, more financially flexible company, and will help ensure that it emerges from both Chapter 11 and the COVID-19 pandemic as an even stronger retailer.
According to a report by CNBC, J.C. Penney last week met a deadline to submit a business plan to lenders. It has been given an extended deadline of July 31 (from July 15) to get its lenders on board with the plan, which reportedly include placing approximately 160 of its remaining stores into a real estate investment.
J.C. Penney said it is providing a comprehensive benefits package for its departing employees, including severance for eligible associates, healthcare coverage through COBRA for those enrolled in benefits, outplacement support, compensation for unused paid time off and extended associate discount benefits.
“Each of these associates has made valuable contributions to the legacy of JCPenney, and we are truly grateful for their service,” stated CEO Jill Soltau. “These decisions are always extremely difficult, and I would like to thank these associates for their hard work and dedication. We are committed to supporting them during this period of transition.”