Type
Internal restructuring
Country
United Kingdom
Region
Location of affected unit(s)
Sector
Retail
Retail Trade, Except Of Motor Vehicles And Motorcycles
Retail Sale In Non-Specialised Stores
47.11 - Retail sale in non-specialised stores with food, beverages or tobacco predominating

2,600 jobs
Number of planned job losses
Job loss
4,000 jobs
Number of planned job creations
Job creation
Announcement Date
17 June 2014
Employment effect (start)
17 June 2014
Foreseen end date

Description

UK supermarket chain Morrisons announced they would introduce a new management structure for their stories that will result in 2,600 redundancies. At least one (some stores two) level of store management will be removed. The decision followed pilots of three possible management structures that were tested over the past year. 

Morrison's major competitors have similarly announced job cuts and/or management restructuring. The shift to on-line shopping has been cited as one of the reasons for this type of in-store restructuring as well as high competition by discount supermarkets.

As reported, the restructure will have a broad impact on store workers. Estimates of between 14,000 and 15,000 workers will be impacted in some way by the change in the organisational structure in stores. Former roles of departmant managers will be combined together with supervisors. So while the removal of one tier of management will result in redundancies, it will also lead to promotions for 1,000 of Morrison's store managers.

In terms of mitigating the job losses, at the same time as announcing the 2,600 redundancies, Morrisons announced the creation of 4,000 additional supermarket jobs. Morrisons has indicated that the newly created positions will first be offered to those current workers who were made redundant as a result of the removal of the tier of store management.

This restructuring announcement follows a restructuring of back office workers last year, which resulted in 700 redundancies and at least 100 planned redundancies at Morrison's distribution centres.

Updated, 21-07-2014: A further sign of competitive pressure on UK supermarket chain, Morrisons has announced that it has shelved plans to create around 330 new jobs at a new site that had received planning approval in Aberdeen in Scotland. Permission was granted to build the new store in 2012, where a supermarket, cafe and petrol station were earmarked for the site.


Sources

  • 17 June 2014: Bloomberg
  • 17 June 2014: The Guardian
  • 17 June 2014: The Independent
  • 21 July 2014: BBC News

Citation

Eurofound (2014), Morrisons, Internal restructuring in United Kingdom, factsheet number 77265, European Restructuring Monitor. Dublin, https://restructuringeventsprod.azurewebsites.net/restructuring-events/detail/77265.