July 6 (UPI) — Two U.S. senators are blasting Bed Bath & Beyond, calling out the recently bankrupt retail giant for purportedly not issuing severance pay to thousands of now-former employees.
In an open letter to the company’s CEO Sue Grove, Sen. Cory Booker, D-N.J., and Sen. Elizabeth Warren, D-Mass., accuse the company’s executives of pocketing millions in bonuses ahead of the bankruptcy while failing to properly take care of their employees.
“We are writing today regarding recent reports that Bed Bath & Beyond failed to pay severance to thousands of workers that lost their jobs during the store closures leading up to the company’s bankruptcy, despite rewarding executives and shareholders with billions of dollars of stock buybacks over the last two decades,” reads the letter, co-signed by Booker and Warren.
“As a result, the workers who ran your business, staffed your retail stores, and fulfilled online orders are being forced to shoulder the brunt of the losses, while shareholders and some executives walk away unscathed. We are seeking further information about Bed Bath & efforts to evade severance pay for its workers, and its plans to treat workers fairly.”
The company’s corporate headquarters is in Booker’s home state of New Jersey.
The two senators also point out Bed Bath & Beyond conducted $1.8 billion worth of share buybacks dating back to 2009, “taking on more and more debt to pay your shareholders even as your core business suffered.”
Booker and Warren also unleashed a series of questions for Grove, asking how many of the chain’s employees were let go with various amounts of notice. They also demanded to see the store’s policy on matching 401k contributions.
The store announced it was laying off 1,295 employees in mid-April, ahead of new laws meant to protect workers coming into effect in New Jersey.
Public pressure later forced management to issue severance to those employees based on seniority.
Founded in Springfield Township, N.J. in 1971, Bed Bath & Beyond succumbed to the pressures of online shopping, in April filing for Chapter 11 bankruptcy protections.
At the time, the company said it would shortly begin “winding down” operations.
In its bankruptcy filing statement, the company said it had more than $5.2 billion in liabilities, compared to $4.4 billion worth of assets.
In late June, online retailer Overstock announced it was buying all Bed Bath & Beyond intellectual property for $21.5 million, as part of the later’s bankruptcy proceedings.
Utah-based Overstock plans to relaunch the Bed Bath & Beyond brand online.
