Coronavirus forces Cheesecake Factory to furlough 41K workers
Executives are cutting their own salaries by 20%
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The Cheesecake Factory has furloughed 41,000 hourly employees after curtailing service inside its restaurants to limit the spread of the COVID-19 pandemic.
The affected workers will be able to keep their benefits and insurance until June 1, however, according to a regulatory filing. They will also be given a daily complimentary meal from the restaurant.
The Calabasas, California-based company's decision mirrors actions at restaurants and bars around the country, many of which have either halted operations or limited service to take-out and delivery, leading to a record 3.28 million unemployment-benefit claims in the U.S. last week alone.
An employee at one of the restaurant's locations in Greensboro, North Carolina, told FOX Business that amid the furloughs, management is doing everything it can to help employees.
"They are also trying to take care of us who got laid off by using their own money to purchase supplies -- essential food, snacks, water, toilet paper, cleaning supplies -- we might need," said Christopher Gallagher.
The Cheesecake Factory. (Photo by: Jeffrey Greenberg/Universal Images Group via Getty Images)
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At the same time, Cheesecake Factory CEO David Overton and other top executives are reducing their salaries by 20 percent, effective April 1. The company's board will also reduce cash retainers for its members by 20 percent.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| CAKE | CHEESECAKE FACTORY INC. | 34.88 | -0.42 | -1.19% |
Along with the furloughs, Cheesecake Factory said it's not planning to pay April rent on its leases, given the impact of decisions by government and landlords to close properties, and is in talks on rent-deferral programs. The move will give the company more financial flexibility amid curtailed sales, according to the filing.
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To date, the virus has infected more than 580,000 people worldwide, with the United States leading the world in the number of confirmed cases. Over 26,000 people have died, according to data from Johns Hopkins University.