Costa says 1,650 jobs are at risk as it battles post-lockdown sales slump – just days after rival Pret slashed 2,800 staff in drive to cut costs
Cafe chain Costa has said 1,650 staff are at risk of redundancy as it looks to cut costs amid continued uncertainty over when trade will fully recover following the pandemic.
It told staff on Thursday that it has started consultations which could impact more than a 10th of roles.
The move comes a week after rival Pret A Manger revealed it was slashing 2,800 roles as part of a restructure of its UK business.
Costa closed nearly all of its 2,700 UK stores for six weeks during the pandemic but had now reopened around 2,400 sites.
The Coca Cola-owned chain said trade is ‘returning’ after being boosted by the Government’s VAT reduction on food and non-alcoholic drinks and the recent Eat Out to Help Out scheme.
However, it said the proposed job cuts had been driven by ‘high levels of uncertainty as to when trade will recover to pre-Covid levels’.
Cafe chain Costa has said 1,650 staff are at risk of redundancy as it looks to cut costs amid continued uncertainty over when trade will fully recover following the pandemic
Neil Lake, managing director for Costa Coffee UK and Ireland, said: ‘Today’s announcement to our store teams was an extremely difficult decision to make.
‘Our baristas are the heart of the Costa business and I am truly sorry that many now face uncertainty following today’s news.
‘We have had to make these difficult decisions to protect the business and ensure we safeguard as many jobs as possible for our 16,000 team members, whilst emerging stronger ready for future growth.
‘As a proud member of the UK high street, we remain committed to the role Costa plays in supporting the economic recovery of the country, but today I want to say a huge thank you to all of our team members that are affected by this announcement and we will be supporting you throughout this process.’
The company said when reviewing roles within stores, a number of options were reviewed prior to making the difficult decision to launch a consultation.
It said Costa had made the difficult decision to freeze all pay increases within the Support Centre and cut all non-essential expenditure.
It added that Costa will seek to find those at-risk alternative roles within the business where possible, and for those leaving the business, support will be provided to help with the transition to new employment.
Coffee and sandwich chain Pret a Manger confirmed it has axed 2,800 roles from its shops
Last week, coffee and sandwich chain Pret a Manger axed 2,800 roles from its shops.
In a statement, chief executive Pano Christou said the coronavirus pandemic ‘has taken away almost a decade of growth at Pret’.
He added that the popular cafe franchise had ‘managed to protect many jobs’ but is ‘gutted that we’ve had to lose so many colleagues’.
Mr Christou said: ‘Although we’re now starting to see a steady but slow recovery, the pandemic has taken away almost a decade of growth at Pret.
‘We’ve managed to protect many jobs by making changes to the way we run our shops and the hours we ask team members to work.