Conforama, which announced in April a restructuring for 2020, gave the unions the outline of its plan on Monday: 1,900 job cuts in France next year, with the closure of 32 Conforama stores and that of the ten stores of the Maison Depot sign. Head office and after-sales service staff will not be spared either, said the CGT and FO unions of the group, whose parent company, the South African company Steinhoff, is suffering from financial difficulties.
Of the 32 stores due to close next year and which currently employ 1,050 people, eight are located in Île-de-France. Two of the three Parisian stores are promised to close. 600 job cuts are also planned in the 164 Conforama stores remaining open, 124 cuts at head office and 26 in after-sales service, while the 100 jobs at Maison Dépôt stores will disappear.
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According to the CGT and FO, a restructuring plan must be presented Tuesday morning to the central works council (CCE) of the group, which has some 9,000 employees in France. The management, which received trade unions in turn on Monday evening, said it wanted to “optimize the operation” of the company, said Jacques Mossé-Biaggini, FO delegate. Another CCE on this reorganization plan is already scheduled for July 11, indicated Abdelaziz Boucherit of the CGT, specifying that “the calendar” of the information-consultation procedure with staff representatives would be “declined tomorrow (Tuesday, editor’s note )”.
The management indicated that “any measure which would have consequences on employment for Conforama in France would be communicated in priority to the representative bodies of the personnel”. “Conforama has no further comments to make at this stage,” it was added.
“According to management, the first dismissal letters will be sent on January 1, 2020 and the plan will be finalized no later than the end of March 2020,” FO’s Mouloud Hammour reported. The restructuring project should take the form of “a social plan containing internal redeployment measures and voluntary departures”, according to Abdelaziz Boucherit. In April, Conforama had reached an agreement with its creditors on a refinancing plan of 316 million euros, approved by the courts.
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The management then informed the staff representatives of this vast refinancing plan broken down into two phases. The first phase was intended to repay part of the group’s debt and was also to replenish the cash flow of the furniture, decoration, household appliances and computer equipment brand. The second phase was to finance a restructuring plan for “loss-making” stores in the first quarter of 2020, union sources had indicated, one of which also said that the search for a buyer was “still relevant”.
Already at the beginning of March, the Conforama unions had expressed their concerns about the future of the brand. In January, the group had sold to Carrefour its 17% stake in the capital of Showroomprivé, number two in France for online destocking, thus garnering an amount of 78.7 million euros. Its parent company, the Steinhoff group, is mired in a financial scandal linked to accounting irregularities. The affair broke out in December 2017 and almost caused the bankruptcy of the company with the discovery of a “hole” of 6 billion dollars in its accounts.
