Marks & Spencer has confirmed plans to cut 525 jobs from its head office in London and is to move another 400 roles outside the capital as part of a £15m shakeup.
The retailer is consulting with head office staff including those in buying, merchandising and marketing about the job cuts, which are part of new boss Steve Rowe’s attempts to reduce costs and simplify the business.
The net reduction in staff numbers, which first emerged over the weekend, will be achieved through a combination of redundancies, non-replacement of leavers and cutting contractors.
On top of the job cuts, 400 IT and logistics staff will move from central London to M&S’s IT centre in Stockley Park, Middlesex, and its distribution hub in Hemel Hempstead, potentially enabling M&S to move out of one of its two head office buildings near Paddington.
The future of Laura Wade-Gery, the main board director currently on maternity leave, is also unclear. Wade-Gery, who was multichannel director in charge of UK retail and online operations, completed her one year break on 1 September. However, in her absence her responsibilities have been shared out among other directors and the retailer would not confirm when she will be returning.
M&S has about 3,000 head office staff working across seven locations so the changes will affect about a third of them. M&S said it would engage in collective consultation with its employees about the changes via elected employee representatives on its Business Involvement Group. M&S currently does not recognise a union.
The retailer said it hoped the changes would save about 1% of its UK costs, after a one-off charge of £15m including payoffs for senior managers including Stephanie Chen, head of childrenswear and homewares, and digital boss David Walmsley. Their departures were announced earlier this year.
The cuts are part of Rowe’s effort to turn around M&S after its biggest fall in clothing sales since the 2008 banking crisis.
Rowe, who found that M&S had become too complex and inefficient in a review of a business after his appointment this year, said: “M&S has to become a simpler and more effective organisation if we are to deliver our plans to recover and grow our business. It is never easy to propose changes that impact on our people, but I believe that the proposals outlined today are absolutely necessary and will help us build a different type of M&S – one that can take bolder, pacier decisions, be more profitable and ultimately better serve our customers.”
He said M&S remained committed to investing more in improving the experience in stores for customers and so there would be no cuts in shop-floor staff.
But the new chief executive, who took the top job after nearly 30 years at M&S, has already faced criticism over changes to pay and pensions for shop-floor staff including cutting premium pay for Sundays. After more than 90,000 people signed a petition calling on the chain to scrap the changes M&S said on Friday that staff would receive extra compensation to ensure their pay did not fall below current levels in future.
