Democratic lawmakers Cory Booker of New Jersey and Elizabeth Warren of Massachusetts have called out home goods retailer Bed Bath & Beyond for allegedly evading severance pay to thousands of frontline retail workers following its bankruptcy filing. In a letter to CEO Sue Gove, the senators demanded more information on the company’s actions leading up to the bankruptcy filing and requested a commitment to fairly treating workers by providing the severance and benefits owed to them. Booker and Warren also questioned the company’s hefty stock buybacks, totaling $11.8 billion since 2004, despite its financial struggles.
The lawmakers criticized Bed Bath & Beyond for its aggressive stock buyback strategy, which saw the company spending a record $230 million in the months prior to filing for bankruptcy. They argued that while shareholders and executives walked away unscathed, the burden of the losses fell on the workers who ran the business, staffed retail stores, and fulfilled online orders.
Since filing for Chapter 11 relief, Bed Bath & Beyond has been forced to close stores and lay off a significant number of employees. Booker and Warren highlighted instances where retail associates were denied severance pay and 401(k) matches, even after receiving misleading guidance. They also criticized the company for cutting nearly 1,300 workers in New Jersey just one day before a new law went into effect that mandates guaranteed severance and enhanced protections for laid-off employees.
Although the company has since agreed to provide severance pay to affected workers in New Jersey following public pressure, the senators are concerned about the lack of protection for employees in other states without similar laws. They believe that Bed Bath & Beyond has failed to fulfill its responsibility to its workers and, despite years of prioritizing shareholder profits over employees, continues to neglect providing fair treatment during the bankruptcy process.
Bed Bath & Beyond recently received court approval to sell its intellectual property and digital platforms for $21.5 million to e-commerce site Overstock.com as part of its efforts to wind down the business. The company is also in the process of auctioning off its 250 namesake stores and 120 Buybuy Baby locations. Additionally, Bed Bath & Beyond plans to seek court approval for the sale of the Buybuy Baby brand’s IP assets to Piscataway-based Dream On Me Inc. for $15.5 million after failing to find a buyer willing to keep the stores running.
In its most recent filing with the U.S. Securities & Exchange Commission, Bed Bath & Beyond stated that it expects to be delisted from the Nasdaq Stock Market at the opening of the July 20 trading session.
Despite attempts to reach a media representative for Bed Bath & Beyond, no response has been received as of now. It remains to be seen how the company will address the concerns raised by lawmakers and provide fair treatment to its employees in the bankruptcy process.
It is clear that the actions of Bed Bath & Beyond have sparked outrage, and the company’s reputation may be at stake. The focus now shifts to how the retailer will respond and whether it will make amends for the alleged evasion of severance pay and mistreatment of its workers during this challenging time.
