JCPenney, faced with unexpected light sales in mid-April, slashed payroll, froze overtime and took other drastic cost-cutting steps in an attempt to protect its bottom line, The Post has learned.
As the end of its first fiscal quarter approached, the mid-priced department store told store managers to take the emergency measures because the chain faced “an expense challenge,” according to an internal memo obtained by The Post.
“We have an expense challenge for the month of April and are asking all stores to do their fair share by closely monitoring all expenses,” the memo said.
Employees were stunned when their hours were slashed on such short notice, one source said. The cut in employee hours saved Penney around 800 hours over two weeks — or approximately $8,000 per store.
“Employees expect reduced hours in the slow months of January and February but not in April,” said one employee, who did not want to be identified. “When the quarterly figures are released, they do not represent the financial struggles and low morale of the thousands of associates company-wide.”
The company reports its first-quarter results on May 13. It declined to comment on the memorandum.
Both full- and part-time employees had their hours reduced. Those who typically work 25 hour a week got cut to 10 or 15 hours.
The temporary cost-cutting also included the use of corporate credit cards, and markdowns were banned, the memo said.
“If you walked into a JCPenney store during those two weeks, you would have seen clothes on the floor and fitting rooms in disarray,” said the employee, who blamed the untidy areas on having too few employees to clean up.