A Bed Bath & Beyond logo is seen at the store in Williston, Vermont, on June 19, 2023.
Jakub Bolzycki | Nour Photos | Getty Images
Washington – Home Goods Retailer Bed bath and others Facing scrutiny from Democratic lawmakers for allegedly evading severance payments for thousands of employees who were laid off following a recent bankruptcy.
One company said it had spent $11.8 billion on stock buybacks for its executives since 2004 and “failed to respect the dignity of retail workers during the bankruptcy process.” letter Bed Bath & Beyond CEO Sue Gove from Senators Elizabeth Warren of Massachusetts and Senator Cory Booker of New Jersey.
Lawmakers allege Bed Bath & Beyond refused to pay severance packages to some employees after it filed for bankruptcy in April and began closing stores and laying off workers. Other employees were denied 401(k) match contributions after receiving misleading guidelines, the letter said.
The collapsed superstore also announced the layoff of 1,295 workers a day before the New Jersey law went into effect on April 10, effectively circumventing laws that provided enhanced protections for laid-off workers, the letter said.later company reverse course Subject to public pressure and to issue one week of severance pay for each year of service to affected employees.
Bed Bath & Beyond did not immediately respond to a request for comment on the lawmaker’s letter.
Bed Bath’s business has been collapsing for several years as it failed to adapt to the rise of e-commerce and keep pace with competitors. amazon. As the retailer reported declining sales and announced plans to close stores and lay off workers, it took on more debt to buy back stock in an effort to boost the stock price.
Buybacks hit a record $230 million in the three-month period in early 2022, months before store closures and layoffs began.
“As a result, workers who run businesses, staff retail stores and fulfill online orders are forced to bear the brunt of the losses, while shareholders and some executives walk away unscathed,” the lawmakers wrote.
Senate Banking Committee members Warren and Booker asked Bed Bath & Beyond to commit to severance packages for its employees and provide details on severance policy, stock buybacks and dividends, and other related issues. Democrats have requested a response by July 19.