Italian chain Carluccio’s could be one of the first to close restaurants for good as a result of the novel coronavirus (COVID-19) outbreak in the U.K. The group, which operates 73 restaurants in the U.K., has filed for administration with FRP Advisory, according to Sky News.
Those 73 restaurants and their attendant operational systems employ around 2,200 people, who were informed by chief executive Mark Jones last week that they would receive only 50 percent of their pay, holiday pay, and tips for March. Jones said in a message to staff:
I realise this is going to be a terrible shock to all of you [...] The rapid decline in sales and then the closure of our restaurants exhausted the company’s cash resources, and we have been struggling to make the payroll payment this month.
Fellow U.K. restaurant chains hit by coronavirus — McDonald’s, Nandos, Costa, and Pret a Manger — have all guaranteed pay through March and in some cases beyond, though McDonald’s and Costa’s model is subject to franchisees acting under company directives. U.K. trade union Unite has described Carluccio’s’ decision as “wage theft.” While the government’s furlough scheme designed to pay 80 percent of workers’ salaries could assist the chain, it has not clarified whether that scheme will be used to recoup the unpaid salaries for workers.
The group closed around 30 restaurants in 2018 in the wake of the “casual dining crunch,” with Jones later saying that it had been two weeks from total collapse.