Outside Business Journal

REI Plans to Furlough Most Retail Employees for Three Months

After closing all 162 of its stores last month while keeping employees on the payroll, the company has now decided that many workers will lose income for 90 days

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As the economic effects of the coronavirus force businesses to make immensely difficult decisions about salaries, REI joins the list of companies that have had to cut employee pay to deal with the crisis. The company announced yesterday that it would furlough most of its retail and field employees for 90 days, starting April 15.

The full letter from CEO Eric Artz states, “Our hope is to begin a gradual reopening of our stores in the coming months. We plan to begin with curbside pickup hopefully in the next 45 days.” Artz himself will forfeit 100 percent of his base salary for the next six months and give up his incentive eligibility for 2020. All furloughed employees will continue to receive their usual health and wellness benefits, with REI covering 100 percent of premium costs.

Unfortunately, layoffs will also accompany the furloughs, though the letter from Artz is less clear about the specifics.

“Our limited operations mean we are also making overall reductions of our headquarters workforce. All impacted full-time employees will receive severance along with outplacement services and support,” the letter reads. “We have considered every option, and I’m confident the actions we’re taking are the most beneficial for affected employees. The best thing you can do to continue to support the co-op is to continue supporting the co-op—both our business and our community of nonprofit partners across the country. In the coming days, we’ll be sharing more about how to directly support that nonprofit network.”

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