A union representing workers in the region warned it could call a strike after the retailer confirmed that a second store in the region was set to close. Ivan Predinsky, a union official, told Reuters 102 jobs were at stake following the decision to shut a hypermarket in Usti nad Labem, a town north of Prague. The retailer has already closed one of its Czech convenience stores.
The troubled supermarket giant is planning to cut hundreds of millions of pounds in costs and sell assets as new chief executive Dave Lewis tackles the biggest crisis in its history. Last year Tesco issued five profit warnings and was thrown into further turmoil by the discovery of accounting irregularities.
The Czech union official said they had scant details on Tesco’s plans and it was concerned that further changes could be on the cards. “It can be a signal that this is the first part of what can happen. We don’t have sufficient information from England,” Predinsky said, adding that the cuts might also affect Tesco’s businesses in Slovakia, Hungary or Poland.
Tesco employs about 13,500 people in the Czech Republic, where it has more than 200 stores. A spokesman for Tesco said the affected staff would be offered roles in nearby stores where possible. “Any colleagues leaving Tesco will be paid full redundancy in line with Czech legislation and will also receive a pay reward,” he said.
At the start of this week, Tesco confirmed plans to close 13 shops in Hungary – where it is the country’s third biggest employer – in a bid to “secure the long-term future and profitability” of the chain. In Hungary, Tesco and other major retailers have been hurt by a steep rise in food inspection costs and a new law that would force the closure of loss-making chains after two successive years in the red.
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