Earlier this year Forever 21 was declared "the most transformative retail concept," as the fashion retailer saw sales soar and expanded throughout the U.S. But earlier this week, Forever 21 sent out a letter, informing some full-time employees that they were being demoted to part-timers and they'd no longer receive benefits, as reported by the online site, The Frisky.com.
Their positions are "reclassified" to part-time as of August 18, according to the memo, which was reportedly leaked by a disgruntled worker. The loss of benefits kicks in August 31 -- less than two weeks away. The workers also will no longer be eligible for paid time off -- vacation time -- as of August 18. Some labor activists are enraged, claiming that the company is "punishing [workers] to retaliate against Obamacare."
The memo, signed by Carla Macias, an associate director of human resources, cites a "company-wide audit of staffing levels," staffing needs and finances. That reason was reiterated by a spokesperson for the company, who stressed that the decision was made "independent of the Affordable Care Act" and that "less than 1% of all U.S. store employees" were affected by "this realignment."
Forever 21 has an estimated 30,000 employees, which could mean about 300 will lose money and benefits. Were any management positions eliminated as a result of this company-wide audit? AOL Jobs emailed the company and hasn't yet received a response.
So far, however, many consumers are not buying the company's logic. On Forever 21's corporate Facebook page, several consumers vowed to stop shopping at the retailer.
Some employers, upset by the Obamacare mandate, have threatened to cut full-time positions. While many large companies are moving to temp and part-time staffs, many economists say, however, that trend has little to do with Obamacare and is the result of deeper changes in the global economy.
Forever 21 is a privately held company, believed to be worth $3 billion. The owners are well-known for their Christian beliefs, and their stores sell T-shirts with slogans such as, "I want to believe / to have hope / and to love / God will guide your soul."
The Forever 21 memo is below: