Fashion retailer Primark has chosen not to take advantage of a UK government scheme that aims to encourage employers to bring back furloughed staff. By opting out of the program, Primark is giving up a potential bonus of around £30 million ($38 million).

Owned by AB Foods, Primark closed all of its stores in March due to the Covid-19 pandemic. This closure resulted in a monthly loss of approximately £650 million ($821 million) in net sales. Across Europe, the company’s 68,000 employees received furlough payments from different governments, preventing layoffs.

However, Primark has now reopened its stores, including its UK locations where around 30,000 employees were placed on furlough. A spokesperson for the company explained that Primark will not be applying for the Job Retention Bonus introduced by the Chancellor recently. Primark had already removed its employees from government employment support schemes in the UK and Europe in line with the reopening of most of its stores. Therefore, the company believes applying for the bonus payment is unnecessary given the current circumstances.

The bonus scheme, if fully implemented, could cost the UK government up to £9 billion ($11.3 billion) if all 9 million people currently on furlough were brought back to work. The scheme was announced last week and applies retroactively.

Primark’s decision not to participate in the government bonus scheme reflects its confidence in the reopening of its stores and the recovery of its business after the lockdown. As one of the leading fashion retailers in the UK, Primark is expected to play a vital role in revitalizing the country’s retail sector in the coming months.

Useful links:
1. UK Government Plan for Jobs
2. Primark Official Website