Hundreds of workers at The Warehouse made redundant

The union says hundreds of workers at The Warehouse are being made redundant. Photo / file

Hundreds of workers at The Warehouse are being made redundant.

First Union has been told about 600 people will lose their jobs as a result of a restructure proposed in July - and they expect more in the weeks to come.

The move will affect 92 Warehouse stores throughout the country.

First Union spokeswoman Tali Williams said it's been a roller coaster ride for workers, who are feeling "absolutely gutted".

"They're watching their workmates around them, their family, disappear, and go off and see what they can find out there. It's a sad time.

"As far as we've been told by the company, and we're aware, there are probably, conservatively, about 600 people who will lose their jobs as part of this process."

Williams said they expect more people to lose their jobs in the weeks to come.

In an NZX announcement on June 8, the country's largest listed retail company said it was moving to an agile business model, which would "likely see a reduction of around 100-130 roles" in its Northcote head office.

It also planned to close six The Warehouse, Noel Leeming and Warehouse Stationery stores. The stores that face closure include: Noel Leeming Henderson Clearance Centre and Tokoroa store, The Warehouse Whangaparaoa, Johnsonville and Dunedin Central stores and the Warehouse Stationery Te Awamutu.

This follows earlier announcements that it would close its The Warehouse store in Birkenhead in July, and Noel Leeming stores in Papanui and The Palms in Christchurch.

The company said the proposals could cost up to 950 jobs.

The group said it planned to go agile from August 31.

Last week The Warehouse posted a $44.5 million profit in the 2020 financial year.

The company, which operates The Warehouse, Warehouse Stationery, Noel Leeming, Torpedo7 and TheMarket.co.nz would have made a loss without the $67.7m it received in wage subsidies.

It will not pay out a dividend despite having a net cash position of $168.1m.

The preliminary unaudited $44.5m net profit after tax in the 12 months to August 2 is a 32 per cent decrease on its earnings in FY19. It would have made a loss of $4.3m without financial support from the government.

Its audited results are due out on Thursday.

The Warehouse Group last week defended laying off hundreds of workers just months after it took the wage subsidy.

It came under fire from both main political party leaders during a leaders debate but justified the redundancies, saying its sales had plunged 67 per cent or $265m during the nationwide lockdown period.

The group told the Herald that the subsidy from government had covered just 50 per cent of its wage bill during that time.

Its annual wage bill for 11,000 staff is approximately $525m per year.