As Germany’s ailing retailer, Karstadtquelle continues negotiations with staff in the hope of getting itself out of financial hot water, its union says it will not allow job losses, store closures or salary cuts.
In six weeks the company is holding a meeting with shareholders to decide a five hundred million Euro share-offering to pay for restructuring. Reacting to an announcement that 77 of its 181 department stores will be closed, German Chancellor Gerhardt Schroeder said his government will try to mitigate the social consequences, “but the responsibility must be clear,” he said “and the board of managers bears the responsibility.” The company’s problems have led to pledges of loyalty from a number of staff. Some employees have said they are in favour of waving certain benefits though unions categorically refuse longer working hours and dismissals. One can certainly do without holiday allowance or Christmas bonus,” this employee said. “I am very loyal to Karstadt and to rescue the company I would do without my benefits, but not my salary. I cannot afford that”. Karstadt has been losing money steadily recently as German consumer confidence has slumped and shoppers have been reluctant to dip into their pockets.