Pub and brewery group Marstons is to cut up to 2,150 furloughed jobs following newly introduced restrictions to curb the spread of the coronavirus.
The company said since the first lockdown was lifted, 10,000 of its employees had returned to work, however new measures such as the 10pm curfew and restrictions in Liverpool, with possible more restrictions in other areas imminent the group has said that its 2,150 pub-based roles are going to be impacted.
A statement earlier this the company reported that like-for-like sales since reopening are at 90% of the previous year’s levels, but warned further restrictions now being imposed on the sector meant about 2,150 of its pub staff were facing redundancy.
The company stated: “Pubs and restaurants were required to close from 20 March to 4 July as part of the general lock-down restrictions to contain covid-19.”
“This 15-week period of enforced closure inevitably had a material impact on the results for the year. Group sales for the year were £821m, 30% below last year. Total pub sales for the year were £515m, 34% below last year, principally reflecting the closure period and the impact of the disposal of 168 pubs for proceeds of £61m in the first half-year.”
“Very few incidences of COVID-19 infection have been reported in our pubs by employees or guests to date, supporting our view that socialising in pubs, where social distancing is enforced and hygiene standards are high, presents lower risks than in other non-regulated settings. Unlike many other retail settings, we committed to collecting Test & Trace data from the moment we were able to open.
“Inevitably, and regrettably, recent restrictions will impact jobs. Since the start of the pandemic, our objectives have included protecting the health and livelihoods of our teams. Government support over the summer was vital, and around 10,000 colleagues have so far returned to work. However, because of the recent additional restrictions, we have reluctantly concluded that around 2,150 pub-based roles currently subject to furlough are going to be impacted.”
Sheena Tandy, restructuring expert at law firm, Shakespeare Martineau, said:
“The new restrictions placed on the country were always going to hit hospitality hard, and Marston’s has shown that even industry giants aren’t safe.
“Confusion caused by the new tier system will only exacerbate hardships already faced by hospitality venues, with no one certain when things will return to normal. Although the new localised furlough scheme provides some relief, job cuts are still being made, showing just how close to the edge many pubs, bars and restaurants are.
“Sector leaders are likely to try and challenge these restrictions, but in the meantime, they should review their business models, assessing what changes can be made and what support is available. These latest restrictions may be unwelcomed by the sector, but they don’t have to mean certain death.”
The current wage subsidy scheme terminates at the end of this month, to be replaced by the Job Support Scheme which will top-up wages for employees who have not been able to return to work full-time because of the coronavirus.
However, companies are expected to make a higher contribution to wages under the Job Support Scheme unless their business is closed under “very high” Tier Three coronavirus restrictions – leading to fears firms will choose to cut workers when furlough ends.