Why does Hasbro layoffs 1100 jobs?
Toy manufacturer Hasbro announced on Monday that it will be reducing its workforce by approximately 20%, amounting to around 1,100 job cuts. The iconic Rhode Island-based company, known for classics like Monopoly, Play-Doh, and My Little Pony, unveiled this decision in a memo to its employees, which was subsequently published in a regulatory filing. Initial reports on this development were first brought to light by The Wall Street Journal.
This round of job cuts comes in addition to the 800 positions that Hasbro had already eliminated earlier in 2023. These measures were part of a strategic plan announced the previous year with the goal of achieving annual savings of up to US$300 million by 2025. At the end of 2022, Hasbro reported having 6,490 employees.
How Has the Pandemic Affected Hasbro’s Sales?
Similar to other players in the toy industry, Hasbro has been grappling with a decline in sales following a surge during the pandemic lockdowns when parents were investing heavily in toys to entertain their children. During the previous holiday season, many toy companies were compelled to reduce prices significantly to clear excess inventory due to weak demand. This trend has persisted, with toy sales in the U.S. declining by 8% from January through August, according to the most recent data from Circana.
In a memo to employees, Hasbro CEO Chris Cocks acknowledged the challenges, stating, “The market headwinds we anticipated have proven to be stronger and more persistent than planned. While we have made some important progress across our organization, the headwinds we saw through the first nine months of the year have continued into the holiday and are likely to persist into 2024.”
Cocks outlined the company’s future strategy, emphasizing a focus on fewer but larger brands, gaming, digital initiatives, and the rapidly growing direct-to-consumer and licensing businesses. Despite this forward-looking approach, shares in Hasbro Inc. experienced an almost 6% decline in after-market trading on Monday.
Severance pay for Hasbro’s employees
Employees facing potential termination at Hasbro may be eligible for severance pay extending up to 24 months, contingent on specific considerations. This compensation in Canada acts as reparation for non-unionized individuals terminated without just cause. Even in situations where termination is claimed to be for cause, there remains a potential entitlement to comprehensive severance pay.
At Whitten & Lublin, we acknowledge the complexities and stress associated with job loss or termination. Our team of experienced employment lawyers is prepared to assist you in navigating this challenging experience, ensuring you comprehend your legal options and receive appropriate compensation. We encourage individuals impacted by recent layoffs in Canada to connect with us for a consultation, easily arranged online or by phone at (416) 640-2667 today.