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International DIY News

Mitre10 Franchisee Temporarily Closes New Zealand Store

Mitre10 NZ

Coronavirus has affected trading to such an extent in New Zealand that the two biggest DIY chains - Bunnings and Mitre10 - are closing stores.

Mitre10

Staff at the Whangaparāoa Mitre 10 store were made redundant last Monday, despite having already taken 20% pay cuts to try to secure the future of the store and save jobs.  Twenty-three roles were affected.

The franchisee - Cam Caithness, who operates four other Mitre10 stores in New Zealand - and First Union, representing the Mitre10 employees, have yet to reach a resolution on the matter. 

Emir Hodzic of First Union pointed out that the New Zealand Government's wage subsidy programme had been put in place to avoid redundancies, stating:

"Under Level 3, and in Level 2, the company will be operating and will be processing sales and slowly returning to normal. So it's unreasonable to ask the workers to take the huge cuts that they are taking while the company has been receiving the wage subsidy," 

"They refused to share any information and just said 'trust us we are doing badly', but those generic terms of Covid-19-related losses in revenue, all businesses throughout New Zealand are going through the same."

One staff member said: "We'd already agreed to take 80 percent of our wages so that [the franchise owner] could protect our jobs, that was one of the agreements we already had and now he's pulled the rug out from under us so it's very, very frustrating," 

In a statement to local news service RNZ, Cam Caithness confirmed he would pay back the money paid out by the government and honour his employer obligations, adding that planning ahead during the lockdown phases had been difficult. He said: 

"The immense financial impact of Covid-19 on our business has forced us to make some difficult decisions," 

"With deep regret, we have temporarily closed our Whangaparāoa store as we refocus on our core Mitre 10 Mega businesses and work to rebuild [the company]."

Staff at Mr Caithness' other stores have been asked to continue to work for 80% of their wages for the duration of alert level two.

Bunnings

Bunnings is closing seven stores which it considers to be unviable: Ashburton, Hornby, Hastings, Cambridge, Rangiora, Te Awamutu, and Putaruru.  The stores are expected to close in June of this year.

Jacqui Coombes, the director of Bunnings NZ, said:

"Despite the incredible efforts of our teams, the challenges at these stores have been exacerbated as a result of the Covid-19 environment and unfortunately these stores are no longer a viable part of our store network."

"While in this instance the decisions taken have largely been connected to the challenges of the recent trading environment, this proposal has taken into account other considerations  including lease arrangements, individual store performance and suitability of location, with some of the stores always intended as temporary locations,"

"This news is understandably upsetting and we will be working closely with our team during the consultation period  to discuss  their individual circumstances, including redeployment to other stores if possible."

Source : Insight DIY Team

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18 May 2020

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