Leaked Memo Shows Forever 21 Demoting Full-Timers To Part-Time

Is it 'retaliation' against Obamacare?

Is Obamacare leading Forever 21 to slash hours?
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:

Add a Comment

*0 / 3000 Character Maximum


Filter by:

I think someone should audit the " less than 1% are affected" by this shift! That is probably as accurate as unemployment and economic statistics that we are served up on a daily basis!
This type of spin is designed to make this more palatable for those of us who retain a FT position, FOR NOW! They mind@*%$ you with this type of comment while reminding you that since you are one of the lucky ones to be full time you will be expected to "do more with less." Oh and by the way, you better be happy about it and keep your mouth shut or you will be one of the poor saps who's status is arbitrarily taken to PT!

August 21 2013 at 8:08 AM Report abuse rate up rate down Reply

Good morning! If you are going to boycott Forever 21 based on the their actions, you are going to have a hard time shopping here in the good ole USA! Wal-mart, Target, Home Depot, and every other big box retailer have been exploiting workers for years with the lack of full time status.
For years Home Depot has worked PT workers 40 hours per week. The term they use is to "flex up" PT workers due to seasonal demands. This is a smokescreen used to work PT employees 40 hours per week without awarding benefits or FT status. In March of this year, Marvin Ellison of HD directed stores to reduce PT workers hours throughout a 12 week period accordingly to reflect an average of 29 hrs. or less. These employees were given less than two weeks notice that their hours were being drastically reduced. When these associates expressed their concerns to management, they were given a "smarmy" response such as "the leadership of HD has decided that they want to respect associates status by complying with their PT status."
Clearly they didn't think that PT associates were smart enough to figure out that this drastic move was not motivated by respect, but Obamacare! COST! Instead of moving a 3 year associate who has averaged 38 to 40 hours per week to FT, store leadership was directed to cut their PT'ers to ( in many cases ) 20 hours! At the same time HD was beefing up spring staff and hiring in temporary workers to work 40 hour work weeks!
These same PT employees are the people that drive 20 minutes to work to be sent home due to midweek payroll cuts due to bad direction and poor leadership. In the state that I live in an employee is be permitted to work a minimum of 4 hours of their scheduled shift or be compensated for a minimum of 4 hours. Home Depot doesn't comply with this state law either.
Just thought you might want to know the next time you go home improvement shopping. Oh also, the temporary worker that is on duty when you go doesn't know the first thing about assisting you with your needs. The person with the knowledge and experience was either sent home early or had their hours cut due to the additional cost of Obamacare!

August 21 2013 at 7:46 AM Report abuse rate up rate down Reply

If you want to fix blame try congress. They are the ones that allow subsidies (Tax Breaks) and corporate welfare.
Big Business (Big Oil, Arms Manufacturers, Big Insurance, Banks and Drug Companies) are and have been running this country for a very long time. As long as Corporations call the shots we will always be like this.

August 20 2013 at 2:52 PM Report abuse rate up rate down Reply

You die hard Obamaites need to recall the ruling from the SCOTUS when they wrongly declared Obamacare constitutional. One comment from the Chief Justice was "you get what you voted for"! Now all the Liberals/Progressivs and Union Members are crying about the punishment for the "so called" middle class getting shafted while others are getting waivers from the individual mandates that will begin in October this year. You voted for the Socialist two times so MAN UP TO THE PLATE and admit your screw ups!

August 20 2013 at 10:18 AM Report abuse -1 rate up rate down Reply
Remuel Archibald

Sorry man, but I have to agree with this article. I don't want to get into too much detail, but I myself actually work at a Forever 21, and the way they treat their employees on a corporate level is unfair. We only get paid slightly above minimum wage, we have to wait a year for a raise (plus a few months depending on the store itself), raises were only 48 cents (not even a full 50) before they raised the hiring rate by 25 cents, now a raise is only 33 cents/yr, shifts as long as 8 or 9 hours with only 1 30-35 minute break, full-time hires don't get their benefits or full-time status until they've been there 6 months, they take their own sweet time to handle any part time sales associate paperwork, and lets not forget the infamous 10% discount!Oh, also my store has no break room, only a stock room, but we have almost 200 employees (174 if im not mistaken) and the managers are forced to use the electric & generator room as an office, we haven't gotten an update on any of the equipment (hangers, racks, fixtures, computers, registers etc.) since the store opened about 6+ years ago (all of which have some type of malfunction--be it major or minor), we hire new people & train them for whatever position every few weeks, and cut the old employees hours dramatically & without warning, and the list goes on, granted I haven't even gotten down to a store level (what goes on in the store that corporate doesn't control) yet. Do Won Chang himself has announced his visit for my store 3 times in the past 2 years & hasn't showed once. I've wondered about the John 3:16 on the bottom of all the bags, because for a man to be of Christian beliefs, he seems to have extremely selfish tendencies when it comes to what got him to where he is. I've also seen some less than Christian pieces there including 2 dresses with goat heads (one designed discreetly with tribal patterns forming the shape, one with a blatant goat's skull) and a few dresses with upside down crosses (they're sold with more of the same dress with the crosses printed the right way; but as long as I've been working there & dealing with the clothes, there are no misprints. Ever. That was no accident). On top of all that, a memo this important, I asked a couple of my managers about it today, and they hadn't even known it existed; yet it went effective yesterday.

August 19 2013 at 3:40 PM Report abuse +2 rate up rate down Reply

The corporations get tax benefits for Obamacare.. they already didn't want to pay benefits...some corporations won't even fire you, they just keep reducing your hours until you quit, that way they don't have to pay unemployment. It's sneaky and unethical.

But you know, they sure deserve those millions in tax cuts.

August 19 2013 at 11:02 AM Report abuse +1 rate up rate down Reply
rex freeway

Why is it so hard for Liberals to understand that the "Messiah" has failed at every single thing he has implemented. Unless his real reason is to destroy a nation because he was raised to hate his White side. A man who smokes cigarettes and professes to know more about healthcare and whats "good" for us than people who never smoked deserves what tobacco brings . A slow horrible death.

August 19 2013 at 10:38 AM Report abuse -2 rate up rate down Reply
Robert & Lisa

Obama strikes again.

August 19 2013 at 7:16 AM Report abuse -3 rate up rate down Reply

Good grief, Ms.Kruger! According to this pitifully slanted story, the cost reduction by a company that employs 30,000 people affects a piddling one-percent of its stated number of employees. If you want to go after employers cutting costs in the face of uncertain times and government mandating, use your pious pen against the mass of companies hiring only part-time and contract workers to avoid the heavy hand of Federal attempts to have American business fund socialized medicine. And lay off the idea of associating Christian values with what you insinuate to be a "mean-spirited" action. Haven't we heard enough of that carp by now? Do you realize that this company could have simply fired these 300 employees, rather than adjusting their status -- which gives them time to seek full-time employment elsewhere while still drawing a salary? Firings, lay-offs and employee status changes are hardly unusual these days. If you need goats to blame, look first in the lush green pastures of Washington, D.C.

August 19 2013 at 4:40 AM Report abuse rate up rate down Reply
1 reply to truroy.t's comment

Well put and well said! The article also said; "Some labor activists are enraged, claiming that the company is "punishing [workers] to retaliate against Obamacare." Sounds to me like this article is referring to the socialist unions who say they support Obamacare but are asking for waivers to be considered exempt from all of the excess healthcare costs associated with the Obamacare.... Hypocrites! Seems to me that this Ms. Kruger is a socialist herself since she seems to embody the socialist anti-corporate, anti-capitalism, anti-Christian mind set as she tries to so subtly attack both capitalism and Christianity beliefs of this one company who was proud enough of their beliefs to display them on T-Shirts they sell. The left are so hateful but they will never admit it and instead they will call you names or put some type of false label on you for pointing out their flawed double standards rather than see the truth and change for the better.

August 19 2013 at 11:13 AM Report abuse -1 rate up rate down Reply

since the ACA for employers has been put off until 2015, what is their rush? maybe it has more to do with pension costs then medical insurance.

August 19 2013 at 3:25 AM Report abuse +2 rate up rate down Reply
1 reply to Blastmsco's comment
Miss Gigi

No. It has more to do with lining their pockets as much as they can before they get tagged for working people to death and not offering benefits. It's happening all over. If you have a company of over 200 workers and you build new million dollar facilities and still don't offer your employees benefits, there is something wrong. Owners forget, they wouldn't have a business if it wasn't for their employees. The world is watching and it's seeing just how screwed up America truly is.

January 21 2014 at 5:37 PM Report abuse rate up rate down Reply

Search Articles

Picks From the Web