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Victoria Beckham reversed the decision to suspend 30 employees of her fashion brand and said her team’s well-being “means everything to me” after the decision to request public money drew strong criticism.
Following a change of heart on the part of the designer and her board, the application for the government scheme was withdrawn and all employees involved resumed their duties.
“Now we are not going to resort to the government licensing plan,” Beckham told the Guardian. “At the beginning of the closing, the shareholders agreed with senior management to grant a license to a small proportion of the staff. At the time, we did not know how long the blockade would last or its likely impact on the business. The well-being of my team and our business is everything to me. “
After entering the lockdown “overnight,” the company “made the best decisions to try to protect our staff,” according to a spokesperson. “Now we have reconsidered and accepted that there is a better way to move forward for our business. These are difficult times and difficult decisions and we are not always doing it right; all we can say is that we are trying to protect our business and our staff.”
Income subsidies
Direct cash grants for freelancers, worth 80% of average earnings, up to £ 2,500 per month. Similar wage subsidies exist for employees.
Business loan guarantees
The government will back £ 330bn of loans to support businesses through a Bank of England scheme for large companies. There are loans of up to £ 5 million without interest for six months for smaller companies.
Business rates
Taxes collected in commercial premises will be abolished this year for all retailers, leisure outlets and companies in the hotel sector.
Cash grants
Britain’s 700,000 smallest companies are eligible for £ 10,000 cash subsidies. Small retailers, leisure and hospitality companies can get higher grants of £ 25,000.
Benefits
The government will increase the value of universal credit and tax credits by £ 1,000 a year, as well as expand eligibility for these benefits.
Sick pay
Legal sick pay will be available from the first day, rather than the fourth day, of absence from work, although ministers have been criticized for not raising the level of sick pay above £ 94.25 per week. Small businesses can request state reimbursements on sick pay bills.
Other
Local authorities will raise a £ 500 million hardship fund to provide people with tax relief from the council.
Mortgage and rental holidays available for up to three months.
A fortnight ago, 30 of Beckham’s 120 employees received letters informing them that they must be suspended for at least two months. Beckham, whose net worth is estimated at £ 335 million and who had been sharing pictures on social media of the family’s luxury lockdown on his Oxfordshire home when the news broke, was heavily criticized for a claim that would have cost around £ 150,000 in government funds.
The licensing plan has become a lightning rod for the great excitement over how the huge economic burden of the crisis should be shared between taxpayers and wealthy individuals and businesses.
Beckham’s investment follows a pattern seen at Liverpool and Tottenham football clubs. Initially, both announced that they would suspend non-playing staff, applying to the government-funded job retention scheme to receive financial support, but later had a change of heart.
In a letter to fans, Liverpool chief executive Peter Moore said: “We think we came to the wrong conclusion last week and we are really sorry.”
However, a source close to Beckham denied that the reaction was triggered by the backlash, saying “he is very aware of the intense scrutiny of being in the public eye, and is not complaining about it.”
A spokesman for the board said the company “now believes that with the support of our shareholders, we can navigate this crisis without resorting to the licensing plan.”
Victoria Beckham’s online clothing sales since the shutdown have exceeded revised business forecasts made at the start of the crisis, and while Britain remains in the shutdown, crucial links in the international supply chain are now emerging. of naphthalene.
All Italian factories producing the brand’s garments are slated to go live on May 11. Beckham is said to be eager to redesign the next collection, though the runway schedule is currently on hiatus, with the fashion weeks in June and July canceled and major September shows in London, New York, Milan and Paris. They will probably expand down, postponed, or reinvented.
The pullback reflects signs of cautious optimism in the fashion industry as some regions of the world begin the process of reopening after the crisis.
Recent reports from China call into question predictions that the quarantine would cause seismic changes in consumer behavior and reduce long-term demand for fashion and luxury.
On April 11, the first day of reopening, the Hermes boutique in Guangzhou raised $ 2.7 million, the highest amount for the brand in history. The phenomenon is called “revenge spending”.
The furor highlights the delicate position of Victoria Beckham and her brand in British public life. As a designer, you have a great brand, but a relatively small company. Against the global luxury giants against which it competes for customers, its label is a small fish.
After taking £ 30 million in investments from Neo Investment Holdings three years ago, the designer and her husband own 47% of her label, with the majority being owned by the board. The brand has established itself as one of the most respected and influential fashion houses on the entertainment circuit, but has yet to make a profit.
The familiar star power of “Brand Beckham” gives its label the kind of public interest that most designers can only dream of. The front row lineup of David Beckham and the couple’s four children alongside Anna Wintour has become an iconic image for fashion week. But Beckham’s status carries the expectation that Victoria will be judged not as a fashion designer, but as a public figure.
Prior to this crisis, the label is believed to be on track to achieve this year. Beckham has given up her salary for the foreseeable future, and she and other shareholders plan to invest more to keep the business running during the crisis.
