Toys 'R' Us agrees to pay $20M in workers' severance
The owners of Toys ‘R’ Us created a fund worth $20 million to help employees who lost their jobs when the company was forced out of business in March.
Bain Capital and KKR – two private equity firms that owned part of the giant toy retailer – each committed $10 million to the fund, which will then be distributed to certain former Toys ‘R’ Us employees in the U.S, according to a news release.
“KKR and Bain Capital's creation of this fund will bring real support to the thousands of dedicated Toys ‘R’ Us employees who lost their jobs,” said Tracey Forbes, a former Toys ‘R’ Us manager who lost her job after working for the company for 31 years. “We hope other firms will follow their lead and contribute.”
Toys ‘R’ Us filed for bankruptcy last year with the hopes of staying afloat and in business, but in March, the New Jersey-based retailer announced that it would sell or close all of its U.S. stores amid mounting debt and years of declining sales.
The company owned more than 700 stores in the U.S., and according to The Wall Street Journal, employed more than 33,000 people. Workers received at least 60 days of salary and benefits once the stores shuttered.
But while the store was liquidating, hundreds of employees were told they would not receive severance, sparking protests outside the New York offices of the retailer’s owners: KKR, Bain and Vornado Realty Trust, according to The Associated Press.
The hardship fund has been structured so that other firms like Vornado can contribute.