British luxury fashion group Burberry has unveiled plans to cut its worldwide workforce by 20%, a move that will affect thousands of staff. As part of this reorganisation, Burberry has begun a collective redundancy process in Italy, where it will dismiss 39 workers out of a total of just under 330 at its Italian headquarters—over 10% of its regional staff. Also, a substantial proportion of fixed-term contracts are not likely to be renewed.
The company has presented the decision as a part of wider in-house restructuring for the purpose of increasing operational effectiveness in the face of slowing growth in the global luxury market. Nevertheless, the news has been received with vigorous resistance from Italian trade unions Filcams, Fisascat, and Uiltucs. They contend that staff should not bear the brunt of restructuring and have accused Burberry of disregarding union suggestions to consider other options.
In a joint press release, the unions also proclaimed a state of agitation and said that the existing problems of the fashion industry cannot be taken as an across-the-board reason for reducing employment. They blamed Burberry for resorting to job cuts because of ill-conceived strategy decisions, poor planning, and excessive investment, and providing severance offers that are even less attractive compared to the offers in the company’s round of layoffs in 2022.
As the unions have it, the crisis lays bare more fundamental problems in the economic models of multinational enterprises where, in the good times, profits are not distributed fairly, and in bad times, losses are transferred to workers. This, they contend, is unjust and unsustainable.
In spite of the rationale behind the company;s layoffs, recent indications of a modest market upturn have led unions to call for Burberry to rethink its plan. They are asking the brand to implement alternative employment protections, such as employing social safety mechanisms, a sustainability strategy for retail and head office operations, choices for voluntary part-time employment, and financial rewards for those opting for voluntary exit instead of compulsory redundancies.
The unions are also meeting with workers to map the way forward and have called for future meetings to discuss possible collective action. They are steadfast in their argument that the company should own up to its mistakes without shifting blame unfairly onto its workers.
