A view of a Best Buy retail store on August 29, 2019 in San Bruno, California.
Justin Sullivan | Getty Images
Best Buy will furlough about 51,000 employees starting Sunday, the company said in a news release.
The retailer’s stores have been closed across the country since March 22, but it has continued to pay its workers and offer curbside pickup. It also suspended all in-home delivery, installation and repairs.
Starting Sunday, Best Buy said it will furlough nearly all of its part-time store employees and some of its full-time store employees in the U.S. About 82% of its full-time store employees will continue to be paid.
The company will continue to offer health benefits to furloughed employees and will cover their total cost for at least three months, according to a news release.
Best Buy joins a growing number of retailers who have furloughed its workforce during the coronavirus pandemic. The company said it’s continued to have strong sales, though, even as stores remain closed to customers. In a news release, Barry said the company has retained about 70% of its sales compared to last year. She said online sales in the U.S. are up more than 250%, and about half of those sales are picked up at its stores.
In addition to the furloughs, Best Buy’s top executives, including its CEO, will take pay cuts. CEO Corie Barry will receive half her salary, and company executives who report directly to Barry will take a 20% pay cut to their base salary through at least September 1. The company’s board of directors will be paid half of their cash retainer fees during the same period.
In mid-March, Best Buy withdrew fiscal 2021 financial outlook. It also drew the full amount of its $1.25 billion revolving credit facility and suspended all share buybacks.
The company said its taken other actions to rein in its budget during the pandemic, including suspending 401k matches, lowering capital spending and slashing marketing expenses.
Best Buy said it’s creating a $10 million employee assistance fund with the company’s founder, Dick Schulze. The fund will help part-time and full-time hourly workers who have been with the company for more than a year. The retailer is repurposing its annual corporate giving budget to contribute to the fund.
This story is developing and will be updated.